US Government Proposes Sweeping Measures to Curb Google's Search Dominance and AI Advancements

US Govt backs Chrome-Android split, curbs on Google AI Search

Disclaimer: This content generated by AI & may have errors or hallucinations. Edit before use. Read our Terms of use The US Department of Justice (DOJ) has charted out the changes it wants Google to make after its antitrust lawsuit found the latter guilty of being a monopolist in Search and Search text advertising. In a filing to Judge Anil Mehta at the United States District Court For The District Of Columbia, the states alongside the department have urged the Court to remedy Google's current anticompetitive practices and prevent anticompetitive conduct for future innovations like AI. It said, "Google's unlawful conduct persisted for over a decade and involved a number of self-reinforcing tactics. Unwinding that illegal behaviour and achieving the goals of an effective antitrust remedy takes time, information (particularly given the informational asymmetries between Plaintiffs and Google), and careful consideration." It asked the Court to prohibit Google from entering into its lucrative revenue-sharing deals with device manufacturers and operating systems, sharing its Search data and advertising data with competitors, and preventing Google from data scraping for AI search results. The US Government has also called for a Court-appointed technical committee to monitor Google's actions as it navigates these remedies. Google has opposed these recommendations, stating that they could increase security risks, reduce innovation, and affect businesses associated with Google. It also added that any Government action against AI could interfere with AI innovation. The DOJ has proposed limiting or prohibiting default agreements, preinstallation agreements, and other revenue-sharing arrangements with distribution channels for search-related products like browsers, search apps, artificial intelligence summaries, and agents. In its judgment, the Court found that Google's deals to be the 'default search engine' had allowed it to abuse its Monopoly. Google has exclusive deals with two major browser developers -- Apple and Mozilla -- and all major Android devices (Samsung, Motorola, and Sony) and the major American wireless carriers (AT&T, Verizon, and T-Mobile). These agreements present Google as the primary browser or search engine on a device/operating system for a share of advertising revenue on the search engine. The lawsuit revealed that these search engines had a significant effect on users, compelling them to use Google over other Search Engines. The US Government also argued that prohibiting pre-installation agreements and preventing Google from using products such as Chrome, Play, and Android to benefit Google search and related products and features could combat Google's monopoly and encourage new entrants. In order to provide users with more options, it has suggested remedies that consider user behavior. The lawsuit found that due to the "power of defaults", "the vast majority of individual searches, or queries, are carried out [by] habit." The States also considered asking Google to provide support for educational awareness campaigns that would enhance the ability of users to choose the general search engine that suits them best. The trial found that Google was able to maintain its dominance in the market due to "feedback loops." For a Search Engine, greater query volume means more user data, this can be a strong proxy for users' intent and behaviour and can improve the quality of its search product. The judgment ruled that Google was able to create a feedback loop as the most used Search Engine in the US, as it had the highest amount of data and could innovate better than its competitors. To offset this, the US Government has suggested that Google provide its competitors in whole or through an API: the indexes, data, feeds, and models used for Google search, including those used in Al-assisted search features It has recommended that Google be prohibited from using or retaining data that cannot be effectively shared with others on the basis of privacy concerns. It is considering remedies that would reduce the cost and complexity of indexing or retaining data for rival general search engines. The state has also proposed remedies for Google's monopoly in Search Text ads. It has recommended licensing or syndication of Google's ad feed independent of its search results. Further, it proposed that Google provide advertisers transparent and detailed information consistent with user privacy through Search Query Reports and other information related to its search text ads auction and ad monetization and allow users to opt out of features like keyword expansion, broad match, etc. These remedies could address the competition concerns that could arise from Google's new advertising technologies created through artificial intelligence, e.g., Performance Max, said the DOJ. The DOJ also charted out administration provisions and protections against circumvention and retaliation. It suggested that Google: The States has asked that the provisions have some degree of flexibility to be effective "because market developments are not always easy to predict and the mechanisms and incentives for circumvention are endless." The DOJ noted, "Google's ability to leverage its monopoly power to feed artificial intelligence features is an emerging barrier to competition and risks further entrenching Google's dominance." Features like artificial intelligence and retrieval-augmented-generation-based tools often rely on websites and other content created by third parties "who have little-to-no bargaining power against Google's monopoly and who cannot risk retaliation or exclusion from Google", it said. The States recommended prohibiting Google from using contracts or other practices to undermine their rivals' access to web content. They also suggested that Google allow websites to opt out of Google using their data to train their models or appearing in any artificial intelligence-based search. Google has stated that it will be appealing the judgment. In response to the DOJ's remedies, it claims that the Government "goes far beyond the specific legal issues in this case." Google claimed that sharing user search queries could create major privacy and security risks. They stated that this data is usually sensitive and personal and in the hands of a different company without strong security practices, bad actors could access them. It also noted that sharing Google's search results would decrease incentives for other companies to innovate in search. Google said that Chrome, an open-source code, and Android, an open-source operating system, offer other companies solutions for free. The company argued that others would not have the ability or incentive to keep them open source or to invest in them at the same level as it does. It stated that breaking off Android and Chrome would change a lot of companies' business models and raise the cost of devices. Google noted that this would also undermine Android and Google Play's competition with Apple's iPhone and App Store. Further, features like Chrome's Safe Browsing, Android's security features, and Play Protect gather information from a range of Google products, and severing Chrome and Android would deny them that access, making patching security bugs harder. Google said that restrictions on distribution contracts designed would affect consumer experiences and create friction for users. They also added that prohibiting contracts would reduce revenue for companies like Mozilla, which would reduce its ability to invest in its own browser and Android smartphone makers, which could potentially raise phone prices. Google said that AI was a developing field, stating that "winners and losers have yet to be determined, and competition globally is fierce." It opposed the DOJ's actions against its AI features, stating, "There are enormous risks to the government putting its thumb on the scale of this vital industry -- skewing investment, distorting incentives, hobbling emerging business models." It said that the Government should instead encourage investment, new business models, and American technological leadership.

US plan to break up Google's search dominance threatens profit engine, AI growth

The U.S. Department of Justice's proposed remedies to break up Google's search dominance could significantly weaken its business and hinder its AI advancements. The DOJ is considering various options, including forcing Google to divest parts of its business, limiting its data collection, and restricting its AI development.The U.S. Department of Justice's proposed remedies to break up Google's search dominance could weaken its main profit engine and stall its advances in artificial intelligence, even though a final outcome may be years away, analysts said. The DOJ said on Tuesday it may ask a judge to force Google to divest parts of its business such as its Chrome browser and Android operating system, that the Alphabet-owned company used to maintain an illegal monopoly in online search. It is only one of the many potential fixes prosecutors are considering. Barring Google from collecting sensitive user data, requiring it to make search results and indexes available to rivals, letting websites opt out of their content being used to train AI products and making Google report to a "court-appointed technical committee" are also on the table. The remedies strike at the heart of the internet empire that has made Google synonymous with search and can reduce its revenue while giving its rivals more room to grow. "The DOJ has reverse engineered Google's formula for success and is intent in dismantling it," said Gil Luria, managing director and senior software analyst at D.A. Davidson. "The proposed privacy and data accumulation remedies would give Google the choice to either share all the data it collects or stop gathering the data in the first place. As it will likely choose the former, that could strengthen its competitors and possibly create new competition," Luria said. Analysts warned that the AI-related remedies could disrupt Google's business when it is already under pressure from startups such as ChatGPT maker OpenAI and AI-powered search engine operator Perplexity. Google's U.S. search ad market share is forecast to fall below 50% for the first time in more than a decade by 2025, according to research firm eMarketer. "The last thing Google needs right now in the broader AI battle is having to fight with one hand tied behind their backs by regulators," said Bernstein analyst Mark Shmulik. Other companies likely to benefit from the remedies include search players such as DuckDuckGo and Microsoft Bing , as well as AI rivals such as Meta Platforms and Amazon . "The framework understands that no single remedy can undo Google's illegal monopoly, it will require a range of behavioral and structural remedies to free the market," said Kamyl Bazbaz, senior vice president of public affairs at DuckDuckGo. 'REMEDY SPAGHETTI' But some industry watchers and analysts said it was far from certain if the remedies, the biggest antitrust effort by the U.S. since a case against Microsoft in 1999, would go through. "The DOJ is throwing remedy spaghetti at the wall," said Adam Kovacevich, CEO and founder of Chamber of Progress, a trade group that represents tech companies. "It might score some headlines, but it's a legal non-starter. The DOJ is throwing out remedies that go far beyond the judge's ruling, and history tells us that broad remedies won't survive the appeals process," Kovacevich said. Alphabet investors, who have seen several antitrust actions this year including a ruling on Monday ordering Google to open up its app store, showed little reaction to the DOJ's proposals. Shares in the company were trading down just 0.9% on Wednesday. "What's clear is that the market isn't worried. This risk has been known for a long time and investors don't appear to believe a forced break-up will happen," said Russ Mould, investment director at AJ Bell.

DOJ pushes to break up Google's search monopoly in antitrust case

The United States Department of Justice (DOJ) has launched an effort to curtail Google's dominance in the search engine market. Its proposal could reshape the landscape of Big Tech. The DOJ's proposal seeks significant changes to break Google's hold on search and advertising. It includes structural changes, such as separating parts of Google's search business and behavioral changes aimed at protecting consumers and fostering competition. One major aspect of the proposal is to prevent Google from leveraging its dominance to control emerging technologies like artificial intelligence. The DOJ also suggested that Google should be required to share search data and indexes with competitors and that websites should be able to opt out of having their content used to train AI models. Additionally, the DOJ recommends establishing a "court-appointed technical committee" to oversee Google's compliance with these new regulations. While none of these are set-in-stone measures, they are all up for consideration in the DOJ's proposal. Related: Google releases production-ready Gemini 1.5 for developers Google responded on Oct. 9 with a blog post defending its business practices and warning of the broader consequences for the tech industry. "Government overreach in a fast-moving industry may have negative unintended consequences for American innovation and America's consumers." However, this is not the only instance of Big Tech companies getting called out for their monopolizing business practices in the last year. Why it's happening The DOJ's move against Google is the culmination of years of scrutiny over the company's search monopoly, which it maintains through exclusive deals with web browsers and phone manufacturers. These agreements ensure Google's search engine remains the default option for billions of users, stifling competition and innovation in the digital ecosystem. As noted by the DOJ in their proposal, this stranglehold limits consumers' choices and gives Google disproportionate control over the flow of information. On Sept. 23, the DOJ brought a similar case against the payments giant Visa, calling its tactics a payments monopoly. However, in the case of Google and the greater Big Tech scene, there's more to this than just search engines. Big Tech under watch Regulators are increasingly concerned about the role Big Tech companies play in shaping the future of AI, which is set to drive the next wave of technological innovation. One fear is that Google's dominance in search could translate into monopolistic control over AI as well. The more data Google collects, the stronger its AI models become, raising concerns about competition in the rapidly growing field of generative AI. Already, regulators in the European Union have launched investigations into Big Tech companies, including Apple, Google and Meta, over violations of its Digital Markets Act back in March 2024. In August 2024, regulators in the United Kingdom probed web services giant Amazon over its $4 billion investment in Anthropic AI, one of the industry's leading models. In its response to the DOJ, Google warned that dismantling its search business would affect its AI efforts and overall profitability, ultimately making it harder for the company to compete globally.

Google's AI and Profitability Challenged as US Targets Search Dominance

US DOJ's Antitrust Remedies Could Disrupt Google's Profit Engine and AI Expansion The US Department of Justice (DOJ) is ramping up its efforts to challenge Google's dominance in the search engine market, posing a potential threat to both the company's primary revenue stream and its advances in artificial intelligence (AI). Analysts warn that the proposed antitrust remedies, while still years from being finalized, could drastically change the landscape for Google and open doors for its competitors. At the core of these proposals are suggestions that Google, owned by Alphabet Inc., could be forced to divest key parts of its business, including the Chrome browser and Android operating system. These platforms have long supported Google's grip on the online search market, but the DOJ now sees them as tools used to maintain what it argues is an illegal monopoly. However, these potential divestitures are only part of a wider range of options under consideration. Prosecutors are also exploring additional steps aimed at weakening Google's control over search and data collection. These could include barring the company from collecting sensitive user information, requiring it to share search indexes and results with competitors, and allowing websites to opt out of having their content used to train AI models. A "court-appointed technical committee" could be introduced to oversee the company's compliance with any new regulations. The news has rattled Alphabet investors, causing the company's stock price to drop 1.5% to $161.86 following the DOJ's latest moves. This comes on the back of a year already filled with antitrust actions against Google, including a ruling earlier this week that forces the company to open up its app store to greater competition. The proposed remedies strike at the heart of Google's business model, which is heavily reliant on the data it collects through its services to dominate the search advertising market. If forced to either share its data or stop collecting it, Google could find its competitive edge significantly blunted. "The DOJ has reverse-engineered Google's success formula and is intent on dismantling it," said Gil Luria, managing director and senior software analyst at D.A. Davidson. "If Google is forced to share its data, this could strengthen its competitors and potentially introduce new players into the market." This is particularly concerning for Google as it faces growing competition in the AI space. Rivals such as OpenAI, the creator of ChatGPT, and AI-powered search engine Perplexity are already making inroads. These AI-related remedies could further disrupt Google's position, coming at a time when it is under pressure to stay ahead in the race for AI supremacy. Mark Shmulik, an analyst at Bernstein, emphasized, "The last thing Google needs in the broader AI battle is to be tied down by regulators. This is happening at a critical time when Google is already projected to see its U.S. search ad market share dip below 50% by 2025." Competitors like DuckDuckGo and Microsoft Bing, along with AI-driven companies such as Meta Platforms and Amazon, are likely to benefit from the DOJ's proposed remedies. Kamyl Bazbaz, senior vice president of public affairs at DuckDuckGo, noted, "It will take a combination of behavioral and structural remedies to truly open the market and diminish Google's monopoly." While the DOJ's efforts are ambitious, some industry watchers are skeptical. Adam Kovacevich, CEO of Chamber of Progress, a tech industry trade group, called the proposed remedies "legal non-starters," adding that such broad solutions historically struggle to survive appeals. Despite this, the potential risk to has been evident for some time, with analysts acknowledging that a forced breakup, though unlikely, remains a looming possibility.

The U.S. wants to stop Google unfairly dominating the nascent AI search market

Understandably, the headline suggestion has been to break up Google, perhaps by forcing it to split off its Chrome browser or Android mobile operating system -- both of which have been key to shoring up Google's search monopoly. But the DOJ also proposed changes (or "remedies" in antitrust-speak) that could severely crimp Google's efforts to maintain a leading position in the age of AI-infused search. The department's suggested fixes would deprive Google of some of the data that it can easily draw on today when delivering AI-powered search results, and perhaps shape the economics of how AI search works. The field of AI search is still in its infancy, but is rapidly gaining pace. Google has been incorporating "AI overviews" into its search results since earlier this year, combining the chatbot functionality of its Gemini AI model with a technique known as retrieval augmented generation (RAG), which retrieves fresh information from websites. The idea here is to provide more up-to-date responses than could be generated purely through a large language model that was trained at some point in the past, and also to avoid the "hallucinations" that are endemic to LLMs -- though Google's AI overviews had an embarrassing launch, with people quickly finding that the overviews sometimes drew on parodic sources to earnestly recommend that people eat rocks or put glue on their pizza. Meanwhile, Google also faces new entrants in the search market, like You.com, Andi, and Perplexity AI Perplexity will later this month start running ads next to its AI-generated search results. (Full disclosure: Fortune has a partnership with Perplexity.) "Artificial intelligence -- while not a substitute for general search -- will likely become an important feature of the evolving search industry," the DOJ wrote in its proposals to the court. "It is, therefore, critical that any remedy carefully consider both past, present, and emerging market realities to ensure that robust competition, not Google's past monopolization, will govern the evolution of general search and text advertising." The department made two specific suggestions that it claimed could stop Google from using its existing search monopoly to ensure its ongoing dominance as AI search becomes ubiquitous. The first involves Google's web crawlers, which the company has used since the last century to index webpages and their contents so it can include this information in its search results. Website publishers clearly benefit from that inclusion, but they can use a file called robots.txt to tell Google's web crawlers to stay away. Just over a year ago, Google made it possible to use this file to also allow or block the training of Google's AI apps on a site's content. Following publisher feedback, Google said in February that opting out of feeding Google's AI efforts wouldn't affect a site's appearance on Google Search. However, the advent of Google's AI overviews complicates this picture -- it's a Google AI service, but also part of Google Search. The DOJ seems to think that, with Google's search monopoly leaving content publishers with "little to no bargaining power," the Big Tech firm should be forced to "allow websites crawled for Google search to opt out of training or appearing in any Google-owned artificial-intelligence product or feature on Google search such as retrieval-augmented-generation-sourced summaries." Fortune has asked Google to clarify whether it is possible for a publisher to reject the use of its content in RAG summaries while still maintaining a presence in Google Search. The DOJ also proposed prohibiting Google from "using contracts or other practices to undermine rivals' access to web content." Earlier this year, Google struck a deal with Reddit that was worth a reported $60 million. Under the arrangement, Google gets to use posts from the online discussion site to train its AI models and feed into Google Search. A few months later, it became apparent that only Google could directly surface content from Reddit, with rival search engines no longer being able to provide useful links to that content. This may be a financial boon to Reddit -- the deal's announcement shortly before Reddit's IPO certainly made for fortuitous timing -- but it clearly also disadvantages Google's rivals. In the DOJ's words: "Google's ability to leverage its monopoly power to feed artificial intelligence features is an emerging barrier to competition and risks further entrenching Google's dominance." For its part, Google responded to the DOJ's proposed remedies by warning of "unintended consequences." On the AI points specifically, regulatory affairs VP Lee-Anne Mulholland said in a blog post that "hampering Google's AI tools risks holding back American innovation at a critical moment." "Business models in AI, much less winners and losers, have yet to be determined, and competition globally is fierce. There are enormous risks to the government putting its thumb on the scale of this vital industry -- skewing investment, distorting incentives, hobbling emerging business models -- all at precisely the moment that we need to encourage investment, new business models, and American technological leadership," Mulholland said. The DOJ will submit more detailed proposals to the court late next month, with Google getting the chance to submit its own preferred remedies by Dec. 20. The two sides will argue their positions in an April trial, with a final ruling following later in 2025. Google is also appealing the underlying antitrust ruling, so it remains to be seen how quickly the final remedies become a reality, or if any of them will ever be implemented.

US plan to break up Google's search dominance threatens profit engine, AI growth

Oct 9 (Reuters) - The U.S. Department of Justice's proposed remedies to break up Google's search dominance could weaken its main profit engine and stall its advances in artificial intelligence, even though a final outcome may be years away, analysts said. The DOJ said on Tuesday it may ask a judge to force Google to divest parts of its business such as its Chrome browser and Android operating system, that the Alphabet-owned company (GOOGL.O), opens new tab used to maintain an illegal monopoly in online search. Advertisement · Scroll to continue It is only one of the many potential fixes prosecutors are considering. Barring Google from collecting sensitive user data, requiring it to make search results and indexes available to rivals, letting websites opt out of their content being used to train AI products and making Google report to a "court-appointed technical committee" are also on the table. The remedies strike at the heart of the internet empire that has made Google synonymous with search and can reduce its revenue while giving its rivals more room to grow. Advertisement · Scroll to continue "The DOJ has reverse engineered Google's formula for success and is intent in dismantling it," said Gil Luria, managing director and senior software analyst at D.A. Davidson. "The proposed privacy and data accumulation remedies would give Google the choice to either share all the data it collects or stop gathering the data in the first place. As it will likely choose the former, that could strengthen its competitors and possibly create new competition," Luria said. Analysts warned that the AI-related remedies could disrupt Google's business when it is already under pressure from startups such as ChatGPT maker OpenAI and AI-powered search engine operator Perplexity. Google's U.S. search ad market share is forecast to fall below 50% for the first time in more than a decade by 2025, according to research firm eMarketer. "The last thing Google needs right now in the broader AI battle is having to fight with one hand tied behind their backs by regulators," said Bernstein analyst Mark Shmulik. Other companies likely to benefit from the remedies include search players such as DuckDuckGo and Microsoft Bing (MSFT.O), opens new tab , as well as AI rivals such as Meta Platforms (META.O), opens new tab and Amazon (AMZN.O), opens new tab. "The framework understands that no single remedy can undo Google's illegal monopoly, it will require a range of behavioral and structural remedies to free the market," said Kamyl Bazbaz, senior vice president of public affairs at DuckDuckGo. 'REMEDY SPAGHETTI' But some industry watchers and analysts said it was far from certain if the remedies, the biggest antitrust effort by the U.S. since a case against Microsoft in 1999, would go through. "The DOJ is throwing remedy spaghetti at the wall," said Adam Kovacevich, CEO and founder of Chamber of Progress, a trade group that represents tech companies. "It might score some headlines, but it's a legal non-starter. The DOJ is throwing out remedies that go far beyond the judge's ruling, and history tells us that broad remedies won't survive the appeals process," Kovacevich said. Alphabet investors, who have seen several antitrust actions this year including a ruling on Monday ordering Google to open up its app store, showed little reaction to the DOJ's proposals. Shares in the company were trading down just 0.9% on Wednesday. "What's clear is that the market isn't worried. This risk has been known for a long time and investors don't appear to believe a forced break-up will happen," said Russ Mould, investment director at AJ Bell. Reporting by Zaheer Kachwala, Akash Sriram in Bengaluru; Writing by Aditya Soni; Editing by Arun Koyyur Our Standards: The Thomson Reuters Trust Principles., opens new tab Akash Sriram Thomson Reuters Akash reports on technology companies in the United States, electric vehicle companies, and the space industry. His reporting usually appears in the Autos & Transportation and Technology sections. He has a postgraduate degree in Conflict, Development, and Security from the University of Leeds. Akash's interests include music, football (soccer), and Formula 1.

US plan to break up Google's search dominance threatens profit engine, AI growth

(Reuters) - The U.S. Department of Justice's proposed remedies to break up Google's search dominance could weaken its main profit engine and stall its advances in artificial intelligence, even though a final outcome may be years away, analysts said. The DOJ said on Tuesday it may ask a judge to force Google to divest parts of its business such as its Chrome browser and Android operating system, that the Alphabet-owned company used to maintain an illegal monopoly in online search. It is only one of the many potential fixes prosecutors are considering. Barring Google from collecting sensitive user data, requiring it to make search results and indexes available to rivals, letting websites opt out of their content being used to train AI products and making Google report to a "court-appointed technical committee" are also on the table. The remedies strike at the heart of the internet empire that has made Google synonymous with search and can reduce its revenue while giving its rivals more room to grow. "The DOJ has reverse engineered Google's formula for success and is intent in dismantling it," said Gil Luria, managing director and senior software analyst at D.A. Davidson. "The proposed privacy and data accumulation remedies would give Google the choice to either share all the data it collects or stop gathering the data in the first place. As it will likely choose the former, that could strengthen its competitors and possibly create new competition," Luria said. Analysts warned that the AI-related remedies could disrupt Google's business when it is already under pressure from startups such as ChatGPT maker OpenAI and AI-powered search engine operator Perplexity. Google's U.S. search ad market share is forecast to fall below 50% for the first time in more than a decade by 2025, according to research firm eMarketer. "The last thing Google needs right now in the broader AI battle is having to fight with one hand tied behind their backs by regulators," said Bernstein analyst Mark Shmulik. Other companies likely to benefit from the remedies include search players such as DuckDuckGo and Microsoft Bing , as well as AI rivals such as Meta Platforms and Amazon . "The framework understands that no single remedy can undo Google's illegal monopoly, it will require a range of behavioral and structural remedies to free the market," said Kamyl Bazbaz, senior vice president of public affairs at DuckDuckGo. 'REMEDY SPAGHETTI' But some industry watchers and analysts said it was far from certain if the remedies, the biggest antitrust effort by the U.S. since a case against Microsoft in 1999, would go through. "The DOJ is throwing remedy spaghetti at the wall," said Adam Kovacevich, CEO and founder of Chamber of Progress, a trade group that represents tech companies. "It might score some headlines, but it's a legal non-starter. The DOJ is throwing out remedies that go far beyond the judge's ruling, and history tells us that broad remedies won't survive the appeals process," Kovacevich said. Alphabet investors, who have seen several antitrust actions this year including a ruling on Monday ordering Google to open up its app store, showed little reaction to the DOJ's proposals. Shares in the company were trading down just 0.9% on Wednesday. "What's clear is that the market isn't worried. This risk has been known for a long time and investors don't appear to believe a forced break-up will happen," said Russ Mould, investment director at AJ Bell. (Reporting by Zaheer Kachwala, Akash Sriram in Bengaluru; Writing by Aditya Soni; Editing by Arun Koyyur)

US Plan to Break up Google's Search Dominance Threatens Profit Engine, AI Growth

(Reuters) - The U.S. Department of Justice's proposed remedies to break up Google's search dominance could weaken its main profit engine and stall its advances in artificial intelligence, even though a final outcome may be years away, analysts said. The DOJ said on Tuesday it may ask a judge to force Google to divest parts of its business such as its Chrome browser and Android operating system, that the Alphabet-owned company used to maintain an illegal monopoly in online search. It is only one of the many potential fixes prosecutors are considering. Barring Google from collecting sensitive user data, requiring it to make search results and indexes available to rivals, letting websites opt out of their content being used to train AI products and making Google report to a "court-appointed technical committee" are also on the table. The remedies strike at the heart of the internet empire that has made Google synonymous with search and can reduce its revenue while giving its rivals more room to grow. "The DOJ has reverse engineered Google's formula for success and is intent in dismantling it," said Gil Luria, managing director and senior software analyst at D.A. Davidson. "The proposed privacy and data accumulation remedies would give Google the choice to either share all the data it collects or stop gathering the data in the first place. As it will likely choose the former, that could strengthen its competitors and possibly create new competition," Luria said. Analysts warned that the AI-related remedies could disrupt Google's business when it is already under pressure from startups such as ChatGPT maker OpenAI and AI-powered search engine operator Perplexity. Google's U.S. search ad market share is forecast to fall below 50% for the first time in more than a decade by 2025, according to research firm eMarketer. "The last thing Google needs right now in the broader AI battle is having to fight with one hand tied behind their backs by regulators," said Bernstein analyst Mark Shmulik. Other companies likely to benefit from the remedies include search players such as DuckDuckGo and Microsoft Bing , as well as AI rivals such as Meta Platforms and Amazon . "The framework understands that no single remedy can undo Google's illegal monopoly, it will require a range of behavioral and structural remedies to free the market," said Kamyl Bazbaz, senior vice president of public affairs at DuckDuckGo. 'REMEDY SPAGHETTI' But some industry watchers and analysts said it was far from certain if the remedies, the biggest antitrust effort by the U.S. since a case against Microsoft in 1999, would go through. "The DOJ is throwing remedy spaghetti at the wall," said Adam Kovacevich, CEO and founder of Chamber of Progress, a trade group that represents tech companies. "It might score some headlines, but it's a legal non-starter. The DOJ is throwing out remedies that go far beyond the judge's ruling, and history tells us that broad remedies won't survive the appeals process," Kovacevich said. Alphabet investors, who have seen several antitrust actions this year including a ruling on Monday ordering Google to open up its app store, showed little reaction to the DOJ's proposals. Shares in the company were trading down just 0.9% on Wednesday. "What's clear is that the market isn't worried. This risk has been known for a long time and investors don't appear to believe a forced break-up will happen," said Russ Mould, investment director at AJ Bell. (Reporting by Zaheer Kachwala, Akash Sriram in Bengaluru; Writing by Aditya Soni; Editing by Arun Koyyur)

DOJ antitrust plan to break up Google threatens profit, AI growth --...

The U.S. Department of Justice's proposed remedies to break up Google's search dominance could weaken its main profit engine and stall its advances in artificial intelligence, even though a final outcome may be years away, analysts said. The DOJ said on Tuesday it may ask a judge to force Google to divest parts of its business such as its Chrome browser and Android operating system, that the Alphabet-owned company used to maintain an illegal monopoly in online search. It is only one of the many potential fixes prosecutors are considering. Barring Google from collecting sensitive user data, requiring it to make search results and indexes available to rivals, letting websites opt out of their content being used to train AI products and making Google report to a "court-appointed technical committee" are also on the table. Alphabet investors, who have seen several antitrust actions this year including a ruling on Monday ordering Google to open up its app store, sent shares 1.5% lower to $161.86 at Wednesday's close, after the DOJ news. The remedies strike at the heart of the internet empire that has made Google synonymous with search and can reduce its revenue while giving its rivals more room to grow. "The DOJ has reverse engineered Google's formula for success and is intent in dismantling it," said Gil Luria, managing director and senior software analyst at D.A. Davidson. "The proposed privacy and data accumulation remedies would give Google the choice to either share all the data it collects or stop gathering the data in the first place. As it will likely choose the former, that could strengthen its competitors and possibly create new competition," Luria said. Analysts warned that the AI-related remedies could disrupt Google's business when it is already under pressure from startups such as ChatGPT maker OpenAI and AI-powered search engine operator Perplexity. Google's U.S. search ad market share is forecast to fall below 50% for the first time in more than a decade by 2025, according to research firm eMarketer. "The last thing Google needs right now in the broader AI battle is having to fight with one hand tied behind their backs by regulators," said Bernstein analyst Mark Shmulik. Other companies likely to benefit from the remedies include search players such as DuckDuckGo and Microsoft Bing, as well as AI rivals such as Meta Platforms and Amazon. "The framework understands that no single remedy can undo Google's illegal monopoly, it will require a range of behavioral and structural remedies to free the market," said Kamyl Bazbaz, senior vice president of public affairs at DuckDuckGo. But some industry watchers and analysts said it was far from certain if the remedies, the biggest antitrust effort by the U.S. since a case against Microsoft in 1999, would go through. "The DOJ is throwing remedy spaghetti at the wall," said Adam Kovacevich, CEO and founder of Chamber of Progress, a trade group that represents tech companies. "It might score some headlines, but it's a legal non-starter. The DOJ is throwing out remedies that go far beyond the judge's ruling, and history tells us that broad remedies won't survive the appeals process," Kovacevich said. However, Russ Mould, investment director at AJ Bell, said this risk has been known for a long time. "Investors don't appear to believe a forced break-up will happen," he said.

DOJ Reveals Its Plan for Breaking Up Google's Search Monopoly

The Department of Justice has laid out its broad-strokes plan for ending Google’s monopoly over internet search after winning its antitrust case against the company in August. The sweeping changes could end Google’s position as the default search engine on billions of devices and require the company to share key information about its search algorithms with competitors. The regulators’ proposals, laid out Tuesday in a filing with the D.C. federal court where the antitrust case was heard, are aimed not only at rectifying Google’s past anti-competitive practices but also at preventing it from unfairly dominating emerging technologies, particularly internet searches enabled by generative AI tools. Any changes to Google’s business model will take time, if they happen at all. The DOJ’s filing indicates the general categories of remedies it might seek but the agency still has significant work to do before it puts forward a detailed plan for the court to rule on. Google, meanwhile, has said it will appeal the court’s decision. Google described the DOJ’s proposals as “radical†and said “government overreach in a fast-moving industry may have negative unintended consequences for American innovation and America’s consumers.†The first step necessary to unwind Google’s illegal monopoly, according to the DOJ, will likely be to “limit or end†the company’s use of contracts and unfair revenue-sharing agreements that have enshrined Google as the pre-installed search engine on all Android devices and the Chrome browser. It could potentially also include forcing Google’s parent company, Alphabet, to split off the Android and Chrome divisions of its business. Google’s search tools are powered by the huge amount of data its web crawlers have indexed and the ranking algorithms that prioritize which results users see first. To level the playing field for competitors, the DOJ said it might try to make the company share the indexes, search results, underlying ranking signals, and models used for Google search, including AI-powered search. “Google’s ability to leverage its monopoly power to feed artificial intelligence features is an emerging barrier to competition and risks further entrenching Google’s dominance,†the DOJ wrote, adding that potential remedies could include prohibiting the company from signing contracts with web publishers that deny rival search engines access to their sites and forcing Google to allow publishers to opt out of having their content scraped and used to generate AI summaries at the top of search results. The final category of remedies the DOJ proposed would aim to spread the wealth generated by advertisements attached to internet searches by making it easier for smaller competitors to enter markets without being crushed by Google’s economy of scale and by requiring Google to be more transparent with advertisers in its ad auctions.

Google's AI deals could hurt its search monopoly appeal, expert says

The US Department of Justice finally proposed sweeping remedies to destroy Google's search monopoly late yesterday, and, predictably, Google is not loving any of it. On top of predictable asks -- like potentially requiring Google to share search data with rivals, restricting distribution agreements with browsers like Firefox and device makers like Apple, and breaking off Chrome or Android -- the DOJ proposed remedies to keep Google from blocking competition in "the evolving search industry." And those extra steps threaten Google's stake in the nascent AI search world. This is only the first step in the remedies stage of litigation, but Google is already showing resistance to both expected and unexpected remedies that the DOJ proposed. In a blog from Google's vice president of regulatory affairs, Lee-Anne Mulholland, the company accused the DOJ of "overreach," suggesting that proposed remedies are "radical" and "go far beyond the specific legal issues in this case." From here, discovery will proceed as the DOJ makes a case to broaden the scope of proposed remedies and Google raises its defense to keep remedies as narrowly tailored as possible. After that phase concludes, the DOJ will propose its final judgement on remedies in November, which must be fully revised by March 2025 for the court to then order remedies. Even then, however, the trial is unlikely to conclude, as Google plans to appeal. In August, Mozilla's spokesperson told Ars that the trial could drag on for years before any remedies are put in place. In the meantime, Google plans to continue focusing on building out its search empire, Google's president of global affairs, Kent Walker, said in August. This presumably includes innovations in AI search that the DOJ fears may further entrench Google's dominant position. Scrutiny of Google's every move in the AI industry will likely only be heightened in that period. As Google has already begun seeking exclusive AI deals with companies like Apple, it risks appearing to engage in the same kinds of anti-competitive behavior in AI markets as the court has already condemned. And giving that impression could not only impact remedies ordered by the court, but also potentially weaken Google's chances of winning on appeal, Lee Hepner, an antitrust attorney monitoring the trial for the American Economic Liberties Project, told Ars.

Google might get broken up after its big antitrust loss

The Department of Justice could consider breaking up Google (GOOGL), after a federal judge ruled in August that the tech giant monopolized the online search engine market. To address Google's monopoly, the Justice Department said in a court filing Tuesday that it will find remedies that would prevent and restrain any present and future maintenance of its dominance in the search market. This would include "behavioral and structural remedies that would prevent Google from using products such as Chrome, Play, and Android to advantage Google search and Google search-related products and features -- including emerging search access points and features, such as artificial intelligence -- over rivals or new entrants," the agency said. Other restrictions include limiting or prohibiting default agreements, preinstallation agreements, and other revenue-sharing arrangements related to its search and search-related products. The DOJ sued Google in 2020 for allegedly monopolizing digital search, pushing out competitors. In his decision, federal judge Amit Mehta said Google's exclusive agreements with companies like Apple allowed it to hike prices for advertisers without any blowback. Mehta wrote "there is no evidence that any rival constrains Google's pricing decisions" and that those unconstrained pricing decisions "have fueled Google's dramatic revenue growth and allowed it to maintain high and remarkably stable operating profits." The judge noted that nearly 90% of all search queries went through Google in 2020. This was the first major tech antitrust lawsuit since U.S. v. Microsoft (MSFT), a 1998 case that found Microsoft monopolized computer operating systems and ultimately led to the demise of Internet Explorer. This case has been heavily referenced in recent legal filings given its similarities to the Google lawsuit. Artificial intelligence is also an area of concern for DOJ, which "will likely become an important feature of the evolving search industry," particularly given Google's ability to exclude competitors using its existing muscle in the search industry. "Google's ability to leverage its monopoly power to feed artificial intelligence features is an emerging barrier to competition and risks further entrenching Google's dominance," the agency said. While AI won't be a substitute for search, the DOJ said it is looking to ensure that any limits it imposes on Google also prevent it from establishing future dominance in the space. In July, Google chief Sundar Pichai said Google Search's new AI tool, AI Overviews -- which had some hiccups in its initial rollout -- saw "great progress" and boosted user engagement for 18- to 24-year-olds. The company has announced a range of new and updated AI products, including new versions of its ChatGPT rival Gemini, as well as a universal AI assistant. Google is also facing its second major federal antitrust lawsuit in the U.S. this year, focusing on its dominance in the advertising market. That case stems from a 2023 DOJ lawsuit, alleging that the tech giant engaged in "anticompetitive, exclusionary, and unlawful conduct to eliminate or severely diminish any threat to its dominance over digital advertising technologies." That lawsuit specifically targets Google's adtech stack, specifically its Ad Manager, the platform that helps publishers and advertisers manage and buy and sell advertising on sites. The federal government's complaint proposes the divestiture of the Google Ad Manager Suite, but doesn't target any of the other areas of Google's adtech stack.

The DOJ wants to break up Google, suggests splitting Chrome and Android

Key Takeaways DOJ proposes breaking up Google, limiting default search engine contracts and sharing search data for equal competition. It suggests splitting off Chrome and Android. Google has criticized the DOJ's changes, citing potential negative impact on consumers, businesses, and security. In August of this year, Federal court judge Amit P. Mehta ruled that Google was an illegal monopolist because of its anticompetitive practices to dominate the search engine market. At that time, Judge Mehta did not offer a solution to end Google's monopoly. Instead, both Google and the DOJ were tasked with proposing possible solutions. The US DOJ has now shared its proposed solutions, which include breaking up Google and splitting off Chrome and Android. Related 4 ways the Play Store could change after Google ordered to offer alternatives to its app platform Let's look to PCs for a few clues 4 In its submission, the DOJ proposes "behavioral and structural remedies that would prevent Google from using products such as Chrome, Play, and Android to advantage Google search and Google search-related products and features -- including emerging search access points and features, such as artificial intelligence -- over rivals or new entrants." It has also suggested limiting Google's default search engine, preinstallation, and revenue-sharing agreements, as they block access to major distribution sources for other smaller players. Court documents have already revealed that Google paid Apple a whopping $20 billion in 2022 to be Safari's default search engine. Besides this, the DOJ wants Google to make its search data, feeds, and models available to its competitors via APIs to ensure a level playing field. Additionally, it wants to limit how Google uses AI in search results by scraping content from third parties. The DOJ proposes that websites should have an option to opt out of Google Search's AI training tools and other AI-powered features. The DOJ has suggested more sweeping changes for Google's advertising business. You can read its full proposal here. Google hits back at the DOJ Close Google has published a blog post responding to the radical changes suggested by the DOJ and highlighting how they will harm consumers, businesses, and developers. In the post, Lee-Anne Mulholland, VP of Regulatory Affairs at Google, states that splitting off Chrome or Android would break them and negatively impact the devices and businesses that rely on them. It would also make the two platforms insecure, as features like Play Protect and Chome's Safe Browsing rely on several Google services for threat detection. Mulholland also points out that forcing Google to share search queries and data with its competitors could pose a serious privacy and security risk for users. The company currently protects this data, but if third-party providers gain access to it, there's no guarantee they won't use it for user profiling. As for Google's default search contracts with companies like Samsung and Apple, Mulholland says unnecessary restrictions on them would "create friction for people who just want to easily search for information." This would also negatively affect the revenue of smartphone vendors, forcing them to raise their phone prices. However, don't expect anything to happen based on the DOJ's suggestions anytime soon. Google has confirmed it will provide a detailed response to the DOJ's proposal in court next year. So, this legal battle will likely drag on for a few years.

US considers breakup of Google in landmark search case

The U.S. said on Tuesday it may ask a judge to force Alphabet's Google to divest parts of its business, such as its Chrome browser and Android operating system, that it says are used to maintain an illegal monopoly in online search. In a landmark case, a judge in August found that Google, which processes 90% of U.S. internet searches, had built an illegal monopoly. The Justice Department's proposed remedies have the potential to reshape how Americans find information on the internet while shrinking Google's revenues and giving its competitors more room to grow. "Fully remedying these harms requires not only ending Google's control of distribution today, but also ensuring Google cannot control the distribution of tomorrow," the Justice Department said. The proposed fixes will also aim to keep Google's past dominance from extending to the burgeoning business of artificial intelligence, prosecutors said. The Justice Department might also ask the court to end Google's payments to have its search engine pre-installed or set as the default on new devices. Google has made annual payments - $26.3 billion in 2021 - to companies including Apple and other device manufacturers to ensure that its search engine remained the default on smartphones and browsers, keeping its market share strong. Google, which plans to appeal, said in a corporate blog post that the proposals were "radical" and said they "go far beyond the specific legal issues in this case." Google maintains that its search engine has won users with its quality, adding that it faces robust competition from Amazon and other sites, and that users can choose other search engines as their default. The world's fourth-largest company with a market capitalization of over $2 trillion, Alphabet is under mounting legal pressure from competitors and antitrust authorities. A U.S. judge ruled on Monday in a separate case, that Google must open up its lucrative app store, Play, to greater competition, including making Android apps available from rival sources. Google is also fighting a Justice Department case that seeks the breakup of its web advertising business. As part of its efforts to prevent Google's dominance from extending into AI, the Justice Department said it may seek to make available to rivals the indexes, data and models it uses for Google search and AI-assisted search features. Other orders prosecutors may seek include restricting Google from entering agreements that limit other AI competitors' access to web content and letting websites opt out of Google using their content to train AI models. Google said the AI-related proposals could stifle the sector. "There are enormous risks to the government putting its thumb on the scale of this vital industry -- skewing investment, distorting incentives, hobbling emerging business models -- all at precisely the moment that we need to encourage investment," Google said. The Justice Department is expected to file a more detailed proposal with the court by Nov. 20. Google will have a chance to propose its own remedies by Dec. 20. U.S. District Judge Amit Mehta's ruling in Washington was a major win for antitrust enforcers who have brought an ambitious set of cases against Big Tech companies over the past four years. The U.S. has also sued Meta Platforms, Amazon.com and Apple claiming they illegally maintain monopolies. Some of the ideas in the Justice Department's proposals to break up Google had previously garnered support from Google's smaller competitors such as reviews site Yelp and rival search engine company DuckDuckGo. Yelp, which sued Google over search in August, says spinning off Google's Chrome browser and AI services should be on the table. Yelp also wants Google to be prohibited from giving preference to Google's local business pages in search results.

Breaking up Google to restore search competition is on the table, says DOJ

The big picture: After Judge Amit Mehra ruled that Google is an illegal monopoly, the Department of Justice is now now crafting plans to curb its dominance and promote competition. They're not holding back on the possible remedies either, with the nuclear option of a corporate breakup on the table. According to a new 32-page filing, the DOJ is considering both "behavioral and structural remedies" to correct Google's anti-competitive practices. And when they say structural, they really mean it - DOJ lawyers are floating the idea of forcing Google to offload major products like Chrome, Android, or the Google Play Store. The central issue is Google's tight grip on search distribution. The DOJ argues that rivals cannot realistically compete for premium search access points because Google's monopoly money lets it pay massive revenue-sharing fees to partners like Apple and Samsung to be the default search option. They contend that no startup can compete with these "monopoly-funded revenue share payments." Search distribution is just one piece of the puzzle, though. The DOJ is also considering potential remedies that would prevent Google from unfairly advantaging its own search and AI products over competitors in emerging areas like AI-powered search. "Fully remedying these harms requires not only ending Google's control of distribution today, but also ensuring Google cannot control the distribution of tomorrow," the Justice Department said. Some of the more creative proposals include requiring Google to fund public awareness campaigns educating users on alternative search engines. The DOJ is also considering forcing Google to share the data indexes, models, and proprietary technology that power its search and AI capabilities. Unsurprisingly, Google is strongly pushing back. In a blog post, the company criticized the DOJ's proposals as going too far - claiming they go far beyond the case's scope of search distribution contracts - and claimed that divesting products like Chrome and Android would "break them" while depriving billions of access to those free services. "This case is about a set of search distribution contracts. Rather than focus on that, the government seems to be pursuing a sweeping agenda that will impact numerous industries and products, with significant unintended consequences for consumers, businesses, and American competitiveness," Google noted. Nevertheless, some of Google's long-time critics support the proposed remedies. Review platform Yelp, which has its own antitrust beef with Google, is advocating for the spinoff of the Chrome browser and pushing for restrictions on Google's promotion of its own business listings in local search results. While a full-blown corporate breakup is still seemingly a nuclear option, how far the crackdown will ultimately go remains to be seen.

Android, Chrome May Split From Google in Antitrust Case

The US is weighing how it might break up Google after it determined the tech giant has a monopoly over web search services and search text advertising. It's considering splitting the Android operating system, the Chrome web browser, or the Play Store off from Google. "Google's anticompetitive conduct resulted in interlocking and pernicious harms," the Justice Department's filing, published on Tuesday, reads. It adds that it's considering "behavioral and structural remedies that would prevent Google from using products such as Chrome, Play, and Android to advantage Google search and Google search-related products and features." The US considers the relationship between Android devices, the Google Play Store, the Chrome browser, and Google Search to be an interconnected web of anticompetitive practices. To fix this, the US may force Google to educate the public on alternatives, force Google let websites opt out of AI training or appear in AI summaries, or share Google's search index, data, and AI models, to name a few examples. It may also try to reduce competitors' costs or delete search agreements and revenue-sharing deals (like that which Google has with Samsung for the Play Store and with Apple for Safari search). Google's ad practices may see an overhaul or a split-off, forcing Google to share more monetization data with advertisers. Regulating Google's AI tools may also be a part of the antitrust case resolution, because the US sees AI as likely to "become an important feature of the evolving search industry" (which it already has through Google's AI Overviews). Unsurprisingly, Google isn't happy with these propositions. Google VP of Regulatory Affairs Lee-Anne Mulholland writes early Wednesday morning that Google sharing Search users' data with competitors could compromise user privacy and security. Mulholland sees a Chrome or Android split from Google as something that would fundamentally "break" them, and argues that regulating or restricting Google's AI tools "risks holding back American innovation at a critical moment." Mulholland concludes: "We believe that today's blueprint goes well beyond the legal scope of the Court's decision about Search distribution contracts. Government overreach in a fast-moving industry may have negative unintended consequences for American innovation and America's consumers. We look forward to making our arguments in court." Earlier this week, a US judge ruled that Google must allow its Play Store to permit third-party app stores on Android devices. This is a big win for Fortnite publisher Epic Games, which has been battling Google and Apple over their respective app store restrictions for years.

Google breakup? Here's what analysts have to say By Investing.com

Investing.com -- As Google (NASDAQ:GOOGL) faces the U.S. Department of Justice's (DOJ) antitrust scrutiny, the possibility of a breakup has sparked debate. In notes this week, analysts from JPMorgan (NYSE:JPM) and Bernstein weighed in on the DOJ's initial remedy framework, which was filed on October 8 in the Google Search trial. While the framework was broad, it focused on four key areas: search distribution, data use, AI, and advertising monetization. JPMorgan analysts noted that the framework was "mostly as expected" but warned that it could carry headline risks. They said the DOJ may push for structural changes in Google's core businesses, such as Chrome, Play, and Android, which could negatively impact the company. Specific remedies like prohibiting default search deals and opening up Google's API and ranking signals could also affect the tech giant's business model, according to the bank. JPMorgan sees the potential for structural changes or even separation proposals, though they believe the framework doesn't drastically alter Google's stock outlook in the near term. Bernstein analysts offered a similar assessment, describing the DOJ's proposals as "a mile wide and an inch deep." They pointed out that while the remedies are broad, the specifics are light, and the final list of remedies won't be known until November 20. Bernstein also emphasized the potential negative impact on Google's AI strategy. The DOJ mentioned AI-related remedies across multiple areas, which could hamper Google's ability to compete in the rapidly growing AI space. "The last thing Google needs right now in the broader AI battle is having to fight with one hand tied behind their backs by regulators," said Bernstein. Both firms agree that the real test for Google lies in the details of the DOJ's final proposed remedies. While Google's response has been critical, the situation remains fluid, with the potential for significant long-term changes to the company's business model.

Google Should Worry About Regulators' Case Against Its AI Push

If investors in Alphabet Inc. weren't all that worried at first about the possible consequences of Google losing its search antitrust case, they perhaps should be now. After a district court's ruling in August that Google is an illegal monopoly, the Justice Department has made it clear it feels handicapping the company's future competitive advantage in artificial intelligence would be one effective way to fix the damage -- making Google's already monumental task of keeping up with AI rivals even more difficult.