Google could be forced to divest parts of the business

The US Department of Justice (DoJ) could ask a federal judge to force Google to sell some parts of the business.

Court papers have been filed to ask for consideration to introduce procedures that could include “structural requirements” of the tech giant due to their online search monopoly to prevent Google continuing with their market dominance.

In August a landmark ruling found Google’s search engine had been exploiting their dominance illegally to stifle innovation as Google processes 90% of US internet search engines, Reuters reported.

The US government are considering remedies which will “prevent Google from using products such as Chrome, Play, and Android to advantage Google Search and Google Search-related products.”

In its court papers, federal prosecutors said, “For more than a decade, Google has controlled the most popular distribution channels, leaving rivals with little to no incentive to compete for users.

“Fully remedying these harms requires not only ending Google’s control of distribution today but also ensuring Google cannot control the distribution of tomorrow.”

Lee-Anne Mulholland, Google’s vice president of regulatory affairs said the DoJ is “already signalling requests that go far beyond the specific legal issues” with regard to the case.

She added, “Government over-reach in a fast-moving industry may have negative unintended consequences for American innovation and America’s consumers.”

Ben Barringer, technology analyst at Quilter Cheviot warned this will be a “long drawn out process.”

He said, “The Department of Justice in the US has delivered its first strike in its attempt to curb Alphabet’s search engine power,” he said.

“It has cast the net fairly wide in its list of potential remedies but for now the detail remains incredibly shallow. The share price was unmoved on the news, as the proposed range of remedies was in line with fears.

“Ultimately this is the opening salvo and the more extreme elements proposed may or may not remain.

“Ultimately the Department of Justice is looking to level the playing field in search, and given Google’s scale it is no surprise to see things such as divestment and opening up data on the cards for change.

“If these changes were to take effect it would be a huge change in how people and businesses use and interact with the internet in their daily lives, so this is clearly a high-stakes game of poker just now.

“But for now not a lot changes, and this will put a lid on investor enthusiasm for Alphabet for this year and most of next, until more is known. Next month sees the next stage of the process with the Department of Justice’s final remedy package revealed before it goes before judges in April.

“Simply put this will be a long drawn-out process with lots of negotiation still to take place. However, the DoJ has fired a shot across the bow of Alphabet.”