Requiring a company to spin off assets is the ultimate punishment and one the Justice Department would not want to impose lightly. Other, less draconian options could include forcing Google to share more information with rivals or imposing restrictions on the Alphabet unit that would prevent it from gaining an advantage in offering AI products. Again, those talks are confidential, meaning Bloomberg's sources do not want to be revealed.
Right now, the Justice Department knows it has a big decision to make. The last time the U.S. government ordered a company to divest some assets was in 2020, when District Judge Thomas Penfield Jackson found that Microsoft had violated Sections 1 and 2 of the Sherman Antitrust Act. After an appeals court overturned much of Judge Jackson's decision, Microsoft settled with the Justice Department and remained intact.
Tuesday's report said the U.S. would try to prevent Google from signing exclusive deals with companies like Apple and Samsung that bring the two device makers billions of dollars annually. In return, Google's search engine will become the default search engine on the iPhone and Samsung's Galaxy phones. If the government calls for Google to be broken up, the entities ripe for a forced divestment could include the Android mobile operating system and Google's Chrome web browser.
Another division that Google may have to divest is the AdWords platform, which is used to sell text advertising. Interestingly, starting September 9, the Justice Department and Google are once again battling against the Alphabet subsidiary, which is accused of monopolizing the digital advertising business. AdWords could be at the center of this lawsuit.