In August, Internet giant Alphabet lost the biggest antitrust challenge it had ever faced when a U.S. judge ruled that its Google subsidiary illegally monopolized the search market.

US Federal Court Judge Amit Mehta ruled that $26.3 billion in payments made by Google to other companies to make its Internet search engine the option by default on smartphones and web browsers prevented any other competitor from succeeding in the market.

As a result of this ruling, the US Department of Justice (DoJ) is proposing that Google will be forced to sell its Chrome browser.

“Google’s illegal behavior has deprived its competitors not only of essential distribution channels, but also of distribution partners who could otherwise allow competitors to access these markets in new and innovative ways,” the Ministry of Justice said on Wednesday. Justice and state antitrust authorities in a court filing.

Last month, the Justice Department already filed court documents indicating that it was considering “structural remedies” to prevent Google from using some of its products. In addition to the sale of Chrome, antitrust regulators are also reportedly demanding that Google take new steps regarding artificial intelligence as well as its Android smartphone operating system.

U.S. antitrust enforcers and a number of U.S. states have joined the case initially filed during the first Trump administration and continued under President Joe Biden. Billed as the “lawsuit of the decade,” the proposal marks the most significant government effort to limit the power of a technology company since the DoJ unsuccessfully tried to break up Microsoft two decades ago.

In August, Google announced it would appeal the decision because it marked a government “irregularity” that would harm consumers.

Chrome is key to Google’s advertising business

The loss of Chrome would be a big blow for Google. While nearly 90% of global search queries are performed through Google, more than 60% of users rely on the company’s browser, Google Chrome, to perform these searches.

Chrome serves as Google’s gateway to the Internet. It allows the company to promote its own products and build customer loyalty, including services like Gmail for email and Gemini for artificial intelligence.

But more importantly, Chrome is a crucial part of Google’s core business of selling advertising on the Internet. Unlike searches on other browsers, Chrome allows Google to collect much more data, such as search behaviors and preferred websites. This wealth of information helps Google target its ads more effectively.

“If Chrome falls, Google falters”

Advertising is essential for Google and its parent company, Alphabet. In 2023, Alphabet generated more than $230 billion ($219.4 billion) in advertising revenue, which accounted for the majority of its $307 billion in total revenue for the year.

Nils Seebach, co-CEO and CFO of digital consultancy Etribes, told DW that “if Chrome falls, Google falters significantly.” He said that in its current configuration, Chrome is “an integral part of Google’s business model, but probably couldn’t survive on its own.” And vice versa, the sale of Chrome would also pose a significant challenge for Alphabet. “Such an event would constitute a major disruption, even for the (digital) market.”

Ulrich Müller of the anti-monopoly association Rebalance Now welcomed the proposal. He said a sale of Chrome would reduce Google’s advertising revenue and curb its market dominance. This could push the company to be more competitive based on the quality of its services, he told DW. Müller also sees the potential for alternative business models, such as subscription search engines.

Seebach noted, however, that it was unclear how long legal proceedings against Google would continue or when the potential breakup would actually occur. “By then, browsers or search engines as we know them today may already be obsolete,” he said.

Victory for American antitrust defenders

The ruling against Google reflects more than a century of U.S. antitrust law. In 1911, these laws ensured the dissolution of Standard Oil, John D. Rockefeller’s monopoly oil company.

Müller said regulatory control of monopolies was very intense in the 1960s and early 1970s, but declined in the 1980s when the neoliberal teachings of the Chicago School of Economics tolerated market concentration if monopolistic firms were effective. This led to fewer structural interventions in the following years.

In the 1980s, however, a major antitrust proceeding was successfully launched against the telecommunications giant AT&T, which was broken up in 1982.

Some 20 years later, Microsoft became the target of monopolistic regulators, with a US court ruling that the software giant must be split up because of its monopolistic practices. The company’s Windows operating system was so tightly integrated with its Internet Explorer browser that it pushed rival Netscape out of the browser market.

Microsoft, however, appealed the decision, thus avoiding a breakup after making parts of its system accessible to competitors.

This article was originally written in German.

Editor’s note: The article, originally published on November 20, has been updated to reflect the US Department of Justice’s proposal to sell Chrome.