Google is pushing back against the US Department of Justice, which wants to break up the company by forcing it to sell properties like Chrome or Android. Google’s counterproposal offers a different approach: rather than spinning off major products, it suggests limiting or modifying the search and app distribution deals Google makes with partners such as Apple, Mozilla, and Android phone manufacturers.
Highlights:
- Avoiding a Chrome or Android sale: Google rejects the DOJ’s push to divest core divisions like Chrome or Android.
- Loosening contract restrictions: For three years, Google wouldn’t tie licenses for Chrome, Search, or Google Play to preinstalling other Google apps.
- Ongoing default search deals: Google could still pay to be the default search engine, but it would allow multiple paid deals on a single device or browser and revisit those terms every year.
- Appeal plans: Although Google plans to appeal the court’s determination that it’s a monopolist, the company must present an updated remedy proposal in March, with a two-week trial slated for April.
In other words, Google is looking to preserve its key businesses while making some concessions about how it bundles and distributes its services.
OpEd: Dismissed at First Glance
The DOJ will likely toss this proposal aside without a second thought. Google’s suggestions don’t seem to threaten its core revenue streams whatsoever.
- Apple Deal Payoffs
The default agreement with Apple isn’t primarily about page views. It’s effectively a massive payout that deters Apple from creating its own search engine. If Apple ever launched a competing service and hard-coded it into every iPhone, Google could lose up to 30 or 40 percent of its traffic instantly—an enormous dent in profit. Remember Apple Maps? Google’s Maps division took a brutal hit when Apple cut Google Maps out by default. Google might not worry about Microsoft these days, but the mere notion of Apple’s next move keeps Larry Page tossing and turning at night. - Android’s Grip
The proposed contract tweaks for Android might look promising on paper, but they don’t crack Google’s hold on the platform. The real lock is Google Play. You can yank default apps all you want, yet if Google controls the only app store that matters, the company still holds the keys to the kingdom. - YouTube’s Growing Entanglement
To me, Chrome and Android pale in comparison to YouTube’s influence. Google funnels a torrent of search traffic toward YouTube—particularly in entertainment categories, where the search results often serve up video link after video link. At times, Google has even run experiments where the entire results page was a wall of YouTube links.
Nothing in Google’s concessions appears to loosen its overall stranglehold or slow its cross-service self-preferencing. The DOJ, in all likelihood, will look at this and say: “Try again.”
If Google’s remedies are chosen over DoJ’s, shares are likely to rally: Barclays
As the CEO and founder of Pubcon Inc., Brett Tabke has been instrumental in shaping the landscape of online marketing and search engine optimization. His journey in the computer industry has spanned over three decades and has made him a pioneering force behind digital evolution. Full Bio
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