Google Forced to Sell Chrome? DOJ's Bombshell Breakup Plan | Pivot

1. KSKara Swisher0:00

   The DOJ is asking a judge in the Google Search monopoly case to force the company to sell its Chrome browser as part of the remedy. Chrome has about 67% of the global market and could go for as much as $20 billion, according to some estimates. The government also wants to stop Google from getting into paid agreements with Apple and others to be the default search engine on phones and browsers. Uh, the DO- DOJ stopped short of requesting a full divestiture of Android. Google called the DOJ proposal extreme and is set to file its own suggestions by December 20th. Remedy hearings will be held in April, and the juz- judges are expected to rule over the summer. I, I know, you know, all these, all these, uh, agencies are sort of waiting for what happens with Trump, although you just never know because he's had some anti-Google, um, statements and everything else, and there'll be a new head of antitrust at the Justice Department. It's not clear who that's gonna be. Um, what do you... D- What do you think of this remedy? It seems like an unusual thing. Tech writer John Gruber noted Chrome and Android are not standalone businesses. They're appendages to Google. It's like saying, "I have to sell my left foot. It's very valuable to me but of no value to anyone else." Um, and if a buyer of Chrome is a company like OpenAI or Microsoft, could they be accused of creating, as you just... you know, another monopoly with this purchase?

2. SGScott Galloway1:11

   I like this. The potential remedies were a fine. You can't come up with fines big enough. Uh, some sort of administrator from the government, bureaucrat that had to... They got to go into any meeting and tell them why they shouldn't do something, which they basically can ignore. Stick the, stick the fat, ugly, weird kid in the corner, and then finally, a breakup. So I was happy to see this. Now whether it holds or not... But I- I'm not sure I agree with the writer because, because Chrome, you know, has about two-thirds global share, I think, of the browser market.

3. KSKara Swisher1:40

   Right, 67.

4. SGScott Galloway1:40

   That's so much attention, um, that's so much attention that a lot of different people could monetize that. So it would have no shortage of bidders. It would, it would, um, uh, immediately stop this default, um, you know, steering everyone towards their search engine. It'd be more of a competition. So I like this. I think... I generally find that the FTC and the DOJ, and this is 'cause they bring in a lot of my colleagues from business schools, are pretty smart about trying to come up with solutions that grow the total market.

5. KSKara Swisher2:12

   Mm-hmm.

6. SGScott Galloway2:13

   Uh, so I, I like this. I hope it goes through.

7. KSKara Swisher2:14

   Yeah, it's interesting.

8. SGScott Galloway2:15

   I don't know if it'll hold.

9. KSKara Swisher2:16

   Y- you know, there's so much uncertainty because, as I said, Cantor is, will be leaving, John Cantor, and Lina Khan's tenure may be over, or maybe not. It's very unclear. You might get someone like Brendan Carr, who's making a grab for power at the FCC, which it didn't have, but may be trying to do so. There's all kinds of uncertainty on who's going to be able to run this and then who is going to be the antitrust head. And it is all in the hands of a single judge, um, who's, who, which then can be appealed, et cetera, and the government can stop trying, right? The government can go a different direction, depending. Um, you know, it'll be interesting because Sundar Pichai, the head of Alphabet, was on the phone with Trump, and of course, guess who was on the phone with him? There's the whole Elon element. Elon was on a phone call with the CEO of Alphabet with Trump. I mean, there's all these different competing power centers, uh, happening here. So, uh, I, I agree with you. I think there sh- something should be cleaved off of these companies. That's, to me, the only... Because-

10. SGScott Galloway3:14

    The key question is where was Omarosa?

11. KSKara Swisher3:16

    (laughs)

12. SGScott Galloway3:16

    I want her back.

13. KSKara Swisher3:17

    I know.

14. SGScott Galloway3:17

    She would act- She actually seems quite credible now.

15. KSKara Swisher3:19

    No, she does. I can't believe it-

16. SGScott Galloway3:21

    Yeah.

17. KSKara Swisher3:21

    ... but she is. You're right. I mean-

18. SGScott Galloway3:22

    Yeah.

19. KSKara Swisher3:22

    It'll be interesting to see what the remedy is, but I think the only remedy is the start to breaking up of, or parts of their businesses and then creating whole new vibrant businesses from them, right?

20. SGScott Galloway3:31

    100%. Mm-hmm.

21. KSKara Swisher3:32

    It just seems healthier in so many ways. A fine is not gonna work. Uh, threatening with prison is not going to work. You know, it's just... They should just cut them up and create new businesses and see what could be made. I mean, having 67% of the global market, and it does, it does help their other businesses. I can't tell you how many times I open Chrome and it says, "Don't you want to make this your default browser?" Right? I, I unsign out from Google because it's constantly trying to get me sucked into their system for no good reason. So, um, it seems like I would rather it be owned by more people. That's my feeling.

22. SGScott Galloway4:02

    But search is arguably-

23. KSKara Swisher4:04

    Finished.

24. SGScott Galloway4:04

    I bet on a gross dollar volume basis, search may be the biggest business in the world.

25. KSKara Swisher4:09

    Yeah, still.

26. SGScott Galloway4:10

    I think it's 150 or I think it's like a quarter of a trillion-dollar business, but I bet it's got gross margins of 80 or 90 points, and that makes even the iPhone look like a distant...

27. KSKara Swisher4:18

    Yeah.

28. SGScott Galloway4:18

    Not, not a great business. So, and essentially, all of this accretes to one player. And if you didn't have this incredible data advantage of looking what everyone is doing on the internet two-thirds of the time and then be able to steer them towards your search engine and then extract all sorts of payments to be the default, uh, you would just have a lot more... All of a sudden, the biggest market in the world wouldn't be a monopoly, which would ultimately lower rents-

29. KSKara Swisher4:43

    Right.

30. SGScott Galloway4:43

    ... on everyone that has to pay the tollways.

Episode duration: 7:07