The U.S. Department of Justice (DOJ) has spoken: it’s time to break up Google. On November 20, the DOJ, along with several states, formally proposed remedies to address Google’s monopoly in the online search market. This follows a landmark ruling in August 2023 by U.S. District Judge Amit Mehta, which found that Google had illegally maintained its dominance in search through anticompetitive practices. Let’s take a look at the DOJ’s proposed remedies and what happens next.
The DOJ Proposes Severe Measures for Google
The DOJ’s key proposals include:
- Forcing Google to sell its Chrome web browser: Chrome, the world’s most popular browser with over 60% market share, is deeply integrated with Google’s search engine and advertising ecosystem. The DOJ argues that divesting Chrome would foster competition by breaking Google’s control over a key access point to its search engine.
- Restricting Google’s agreements with third parties: The DOJ seeks to ban Google from making multibillion-dollar deals with companies like Apple and Mozilla to secure default search engine status on devices and browsers. These agreements were deemed central to Google’s monopoly.
- Requiring data-sharing with competitors: Regulators want Google to share search and user data with rival companies, enabling them to compete more effectively.
- Potential unbundling of Android: The DOJ also proposes separating Google’s Android operating system from its other services, such as Google Search and the Play Store, to prevent it from favoring its own products.
These measures are intended to address what the DOJ described as a “skewed competitive environment” created by Google’s illegal advantages. The case marks one of the most significant antitrust actions against a tech giant since the Microsoft case in the late 1990s. If approved by Judge Mehta, these remedies could reshape the tech industry and significantly weaken Google’s dominance in search and advertising markets. A final ruling on the proposed penalties is expected by mid-2025.
How Will a New President and Congress Affect the DOJ Ruling?
The future of the DOJ’s case against Google under the incoming Trump administration and Republican Congress remains uncertain, as President-elect Donald Trump has expressed reservations about drastic measures like breaking up the tech giant. While the DOJ, under the Biden administration, has proposed significant remedies to curb Google’s monopoly as noted above, President-Elect Trump’s stance suggests a more moderate approach may emerge.
President-Elect Trump’s Position on Google
President-Elect Trump has indicated skepticism about breaking up Google, stating that such actions might harm U.S. interests. He has suggested focusing on making Google’s practices “more fair” rather than pursuing extreme remedies like divestitures.
This stance aligns with a broader expectation that his administration may temper aggressive antitrust enforcement initiated under Biden, favoring less disruptive remedies.
Leadership Changes at the DOJ
Trump is expected to appoint new leadership at the DOJ, including a replacement for Assistant Attorney General Jonathan Kanter, who has been a strong advocate for tough action against Big Tech. The new appointees could shift the DOJ’s focus toward less drastic penalties.
The direction taken by Trump’s incoming Attorney General nominee will be pivotal. Trump’s first pick for attorney general, Matt Gaetz, had previously called for breaking up Big Tech. But Gaetz has withdrawn from consideration. So, the stance of an incoming attorney general remains a mystery.
Congressional Influence
A Republican-controlled Congress may also play a role in shaping antitrust policy. Historically, Republican lawmakers have been less inclined to support aggressive regulatory interventions in markets, which could further influence the DOJ’s strategy under Trump.
Judge Amit Mehta’s Role
Regardless of political shifts, Judge Amit Mehta will ultimately decide on the remedies in the Google case. The hearings on penalties are scheduled for April 2025, with a final ruling expected by late summer. Even if the DOJ softens its stance under Trump, Mehta could still impose significant restrictions based on his August 2023 ruling that Google illegally maintained its search monopoly.
What Are Some Likely Scenarios for Google?
What might Judge Mehta decide? Here are three potential scenarios:
- Moderate remedies: Under Trump, the DOJ might pivot toward less disruptive measures, such as banning exclusive search deals or imposing data-sharing requirements without requiring divestitures like selling Chrome or unbundling Android.
- Prolonged legal battle: If Judge Mehta imposes stricter remedies aligned with the Biden-era proposals, Google is almost certain to appeal. This could delay any significant changes until well beyond 2025.
- Political calculations: Trump’s administration may prioritize maintaining U.S. tech dominance over aggressive antitrust actions, potentially scaling back remedies to avoid weakening Google in global competition.
While the Biden administration’s DOJ has proposed sweeping changes to curb Google’s market power, Trump’s incoming administration is likely to adopt a more cautious approach. The ultimate outcome will depend on Judge Mehta’s rulings and how much influence Trump’s DOJ exerts in shaping or revising these remedies.
What Advertisers Should Do
Advertisers who rely on Google’s advertising business should prepare for potential disruptions stemming from ongoing antitrust actions and regulatory changes. These legal challenges could reshape Google’s advertising ecosystem, affecting strategies that advertisers have relied on for years. That said, it is important not to panic. As noted above, the outcome might not be as severe as Google fears. Here are key steps advertisers should take to adapt:
Diversify Advertising Platforms
- Explore alternatives: Begin testing and allocating budgets to other platforms, such as social media (e.g., Facebook, Instagram, TikTok, LinkedIn), emerging search engines such as Perplexity, or programmatic advertising networks. This diversification can reduce reliance on Google and build resilience against potential changes in its ecosystem.
- Experiment with connected TV (CTV) and audio ads: These channels are growing in popularity and may offer new opportunities for audience engagement.
Build Cross-Platform Expertise
- Train marketing teams to develop skills in managing campaigns across multiple platforms. This includes understanding different ad formats, audience behaviors, and performance metrics.
- Adopt tools that facilitate multi-platform campaign management, such as third-party software for integrating data and optimizing across various channels.
Focus on First-Party Data
- Strengthen efforts to collect and utilize first-party data (e.g., customer emails, website interactions) to reduce dependence on Google’s data-driven targeting capabilities.
- Build direct relationships with customers through email marketing, content marketing, and loyalty programs.
Prepare for Higher Costs and Competition
- Be ready for increased competition in digital advertising as regulatory changes may level the playing field. This could lead to higher bidding costs for ad placements as more advertisers enter the space.
- Optimize ad spend by focusing on high-performing campaigns and refining targeting strategies.
Monitor Legal and Regulatory Developments
- Stay informed about the progress of Google’s antitrust cases and potential remedies, such as forced divestitures or new restrictions on its advertising practices. These rulings could directly affect how ads are displayed and priced.
- Use this knowledge to anticipate shifts in the market and adjust strategies accordingly.
Build Agility into Marketing Strategies
- Adopt flexible approaches that allow quick pivots in response to market changes. For instance, test campaigns across multiple platforms simultaneously to identify what works best under different conditions.
By diversifying platforms, enhancing skills, and staying proactive about changes in the digital advertising landscape, advertisers can mitigate risks associated with potential disruptions to Google’s advertising business while uncovering new growth opportunities.
True Interactive has your back. We work with all our clients to tailor a flexible advertising approach that meets their needs in the face of change. Contact us to learn how we can help you.
