• by Laurie Sullivan , Staff Writer, August 14, 2024

Will the U.S. Justice Department force Google’s parent Alphabet to shed at least one of its business units?

It could take years for any type of breakup to be finalized.

The ad industry has been batting around that possibility for years. And now based on a judge’s ruling that Google violated antitrust laws, the hypothetical could become a reality.

The breakup is among possibilities being explored, according to Bloomberg, citing people with knowledge of the deliberations. Less severe options being considered include forcing Google to share more data with competitors and taking measures to prevent it from gaining an unfair advantage in artificial intelligence (AI) products.

Google’s Android operating system and its web browser Chrome are two of the most likely units to be involved. One source that Bloomberg cited pointed to platforms used to sell search text advertising.

Google relies on its partnerships for search market share, at least according to one survey of 1,000 U.S. consumers conducted by BMO Capital Markets.

"While 83% of consumers consider Google their primary search engine, ~33% of Google users would likely use Bing as their primary search tool if it were the default setting on their phone," the analyst firm wrote in a research note published earlier this week. "Bottom line: Our survey suggests [Google] would be impacted if the default setting were removed. However, recent legal expert checks suggest partnerships with Apple/Samsung likely to remain unchanged until a remedy is enacted, which could take multiple years."

The study suggests the average consumer uses more than one search engine, though Google is the most popular with 94% of consumers using it. Bing was the second-most used with 34% of consumers using it, followed by DuckDuckGo, which 32% of consumers suggest they use.

While the breakup of Google seems highly unlikely at the moment, Microsoft avoided a fate that resembles the action nearly 25 years ago despite a similar antitrust ruling.

Will the ruling change how consumers use Google's products?

BMO ran an internet search survey of 1,000 U.S. consumers. The findings suggest Google's default search setting helps the company to drive search share.

Andrew Frank, distinguished vice president analyst in the Gartner Marketing Practice, told Performance Marketing Insider that he sees similarities between Google's and Microsoft's antitrust cases.

"While both cases involved market dominance and anticompetitive practices, the regulatory environment has evolved and the case against Google can be seen as part of a broader scrutiny of Big Tech companies involving multiple jurisdictions, including significant actions by the EU," Frank said. "As for politics, we might note that both cases exposed the limitations of lobbying to mobilize political intervention."

Disruptions to the ad industry are being discussed among experts across platforms, publishers, brands and agencies. Frank said Gartner analysts are hearing a lot about performance gaps in automated ad optimization, but it's not necessarily related to any disruption from the trials.

Google will go back to court in September. The federal trial is scheduled to begin in Virginia. It will discuss the Justice Department's allegations that its advertising technology constitutes an illegal monopoly.