Report: DoJ may want to break up Google

In the late afternoon of August 13, Bloomberg reported that the Department of Justice (DoJ) is considering breaking up Google. No, they’re not kidding.

Why? In a recent landmark decision, Judge Amit Mehta of the US District Court ruled that Google violated the Sherman Antitrust Act by stifling competition and arranging exclusive and restrictive contracts with other companies. As Mehta wrote in his decision, “Google is a monopolist, and it has acted as one to maintain its monopoly.”  

Also: Google controls an illegal monopoly in internet search, US judge rules

Mehta found Google engaged in practices that prevented its rivals from competing fairly. 

In particular, Mehta criticized the company’s contracts with Apple, Samsung, other smartphone companies, and Mozilla — contracts that required these companies to use Google as the default product search engine. Google reportedly paid Apple $18 billion annually to secure its position as the default search engine on iOS devices. Other firms received over $8 billion annually to ensure that Google was their search engine of choice.

Google, of course, denies that these payments were the reason its search engine was selected again and again. Google Global Affairs President Kent Walker replied, “This decision recognizes that Google offers the best search engine but concludes that we shouldn’t be allowed to make it easily available.” 

You might have assumed this would have come to nothing in the short run. After all, Google has already announced that it would appeal the decision. I know, I did. It looks like we were wrong.

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We might not have been so optimistic if we had looked back at the case’s history. When the DoJ first started the suit against Google in 2023, US Attorney General Merrick Garland said, “Over the past 15 years, Google has engaged in “anticompetitive, exclusionary and unlawful” practices that have allowed it to “severely weaken if not destroy competition in the ad tech industry.”

The market is certainly taking this rumored move seriously. After a 1.21% bump from Google announcing a host of new Pixel and other consumer devices, in after-hours trading, Google’s parent company, Alphabet shares fell by 1.25%.