The U.S. Department of Justice has set its sights on Google. Essentially, it's going after all companies that are doing too well. Why? Because, perhaps, they don’t like to see companies grow too big. The DOJ is investigating the possible breakup of Google. Yes, you heard that right—breaking Google into smaller companies. And why would they do that, you ask? Well, the U.S. Department of Justice argues that Google has built a monopoly by dominating products like Chrome, Android, and of course, its search engine. In fact, Google handles 90% of online searches in America! So, the DOJ is exploring ways to limit this monopolistic influence.
And how could that happen? The solutions proposed by the DOJ range from regulatory interventions to structural changes. For example, separating Chrome from Android and the Play Store. In simple terms, they want to stop Google from promoting its own products on its platforms at the expense of its competitors.
And for those who didn’t catch that, Yes, the DOJ means that there should be four different companies instead of one as it stands now. One company for Chrome, one for Android, one for the Play Store, and Google would keep all the remaining activities.
And what does Google say about all this? Obviously, they’re not happy at all. In a blog post, the company’s vice president, Lee-Anne Mulholland, mentioned that breaking up units like Chrome and Android would cause many problems, as it would significantly change many of the services we use every day.
It’s also worth noting that other companies, like Yelp, have sued Google , arguing that the company prioritizes its own business listings over its competitors. But isn’t that logical, you might think? I mean, what would they promote, their competitors’ services?
And here’s the big question: Who’s right? Is Google really a monopoly, or is it simply dominating because of its innovation? And if it is a monopoly, would a breakup truly help?
This isn’t the first time the U.S. government has considered breaking up a large company. There are past examples where the U.S. took similar steps. One case was the breakup of AT&T in 1982, which resulted in the creation of several smaller companies. Another case involved Standard Oil in 1911, where the Supreme Court ordered the company to be split into 34 smaller entities to prevent monopolistic practices.
Where those cases successful? AT&T was broken up in several smaller companies but today most of them have merged again and the company is now bigger that before.
In 1911, the Supreme Court ordered the dissolution of Standard Oil into 34 smaller companies due to antitrust violations. As you can Imagine 100 later most of those companies merged again and now ExxonMobil and Chevron are some of the remaining 34.