About ten days after a landmark ruling found Google guilty of illegally monopolizing the online search market through exclusive deals with phone manufacturers, the U.S. government is considering a significant action against the tech giant.
The U.S. is contemplating breaking up Google.
A recent Bloomberg News report suggests that the U.S. Department of Justice is leaning toward splitting up the search giant, a subsidiary of Alphabet Inc., following the August 5 ruling.
This potential move aims to restore competition in a market where a single player has almost uncontested power over pricing.
If the government proceeds with this plan, it would mark the most significant forced breakup of a U.S. company since AT&T—a telecommunications giant that once dominated the phone network—was divided into multiple entities in 1984.
The last time the U.S. government attempted to dismantle a major company was in the late 1990s when it unsuccessfully tried to break up Microsoft for monopolizing the PC operating system market.
The case against Alphabet is grounded in antitrust laws, including the Sherman Act, the Federal Trade Commission Act, and the Clayton Act—federal regulations designed to prevent large companies from abusing their market dominance.
With a market value approaching $2 trillion, Alphabet is currently the world’s fourth-largest company, a position it secured by expanding its online advertising business through its widely-used search engine. Last year, Alphabet generated approximately $175 billion in revenue from its search engine and related businesses.
Why is Google under scrutiny?
With 8.5 billion daily searches, Google has become so ubiquitous that its name is now synonymous with searching the web—just “Google it.”
However, U.S. authorities believe the company has grown too powerful. Earlier this month, they secured their first major antitrust victory against a tech firm in over two decades.
Alphabet’s alleged offense lies in paying hardware manufacturers like Apple and Samsung “billions” of dollars over the years to secure “prime placement” of its apps on their devices, such as phones and tablets.
This aggressive strategy has made Google the “default” browser for many users, solidifying its status as the most widely used search engine globally.
The court’s decision determined that Google holds a monopoly over search text ads, which are prominently displayed on search results pages to drive users to specific websites.
