Alphabet’s Google has offered a proposal to loosen its agreements with Apple and other partners that set Google as the default search engine on new devices. The move aims to address a U.S. District Court ruling that found the company unlawfully dominates the online search market.
Google’s proposed remedies focus on its distribution agreements with device manufacturers, browser developers, and wireless carriers. These agreements were deemed by U.S. District Judge Amit Mehta to give Google an unfair advantage over competitors, with the judge citing their exclusivity as a barrier to competition.
To address these concerns, Google suggested making its agreements non-exclusive and allowing browser developers to revisit their default search engine choice annually. For Android device manufacturers, the proposal includes unbundling Google’s Play Store from its search engine and Chrome browser.
However, Google’s proposal stops short of addressing one critical element: revenue-sharing agreements. These deals, which provide device and software companies with a portion of Google’s ad revenue, are a significant part of the company’s dominance. In 2022, Apple reportedly earned $20 billion through its agreement with Google. Mozilla and other independent browser developers have argued that these payments are vital to their operations.
Kamyl Bazbaz, a spokesperson for DuckDuckGo, criticized Google’s approach, stating that it maintains the status quo. “The remedy must stop illegal conduct, prevent its recurrence, and restore competition in the affected markets,” he said.
The U.S. Department of Justice and a coalition of states have rejected Google’s proposal, arguing that more drastic measures, including divestitures of its Chrome browser and potentially its Android operating system, are necessary. They will present their case in an April trial, calling witnesses from Microsoft, OpenAI, and AI startup Perplexity to demonstrate the need for broader remedies.
The prosecutors also aim to stop Google from paying to be the default search engine, investing in search rivals or AI query products, and to mandate licensing of its search results and technology to competitors.
Google cautioned Judge Mehta to act cautiously, arguing that antitrust remedies should not stifle innovation, particularly as artificial intelligence is transforming online search and other digital products. “Courts have historically avoided imposing remedies that chill innovation,” Google emphasized in court filings.
The outcome of this case could reshape the online search market and influence the future of AI-driven products. For now, the stage is set for a high-stakes trial that will determine how deeply regulators can intervene in Google’s business practices.