When the European Union passed its landmark Digital Markets Act, it included the power to break up Silicon Valley giants — but only as a last resort, a sort of nuclear option. Brussels limited itself to significant but marginal tweaks such as loosening control of the Google and Apple app stores and increasing interoperability between Meta’s WhatsApp and other messaging apps. 

The Biden administration wants to go further. After winning a trial determining that Google had abused its monopoly in web search, it is now proposing remedies to force the company to sell off its Chrome browser and perhaps its Android mobile phone operating system. Google would also be forced to hand over its search data to rivals and restrict its investments in artificial intelligence.

In the closing arguments of a second antitrust trial, US government lawyers charged Google with abusing a monopoly in online advertising technology. A federal judge will rule on the case in coming months.

It looks like the world in reverse. Washington is replacing Brussels as the world’s most hardline tech enforcer. While a long road of appeals lies ahead, and the new Trump administration will weigh in, the proposal to break up Google underlines a growing global consensus that the power of a few digital behemoths needs to be diluted. The big, unanswered question is how to cure the competition disease. Effective remedies will be difficult to impose.

A crackdown carries big risks, industry critics say. China could benefit. Consumers could be harmed. Innovation could be chilled. If approved, these proposals “will kneecap AI development and undermine broader US national security interests, potentially compelling foreign competitor access to Google’s intellectual property and compromising the privacy and security of US citizens,” warned Chris Mohr, President of the Software & Information Industry Association SIIA.

Incoming President Donald Trump’s attitude could be key — and he does not seem hot on the idea. Breakup is a “dangerous thing because we want to have great companies,” he said before the election. “We don’t want China to have those companies.”

Although these fears may be overblown, radical change will be tricky to impose, under uncertain circumstances. Google now gets to propose alternative remedies. “We’re still at the early stages of a long process and many of these demands are clearly far afield from what even the Court’s order contemplated,” said the company’s chief legal officer Kent Walker. The judge overseeing the case will make a final decision and it can be appealed.

History offers some clues. A federal judge determined in 1999 that Microsoft had illegally used the market power of its Windows operating system to box out rival browsers, namely Netscape Navigator. A district court ordered a breakup of Microsoft, splitting the company into two separate units, one to produce the operating system and one to produce other software components.

The Google case looks similar. The government alleged that the search company created strong barriers to entry and a feedback loop that sustained its search dominance. “The end result here is not dissimilar from the Microsoft court’s conclusion as to the browser market,” Judge Amit Mehta wrote in his 300-page ruling. “Just as the agreements in that case help[ed] keep usage of Navigator below the critical level necessary for Navigator or any other rival to pose a real threat to Microsoft’s monopoly, Google’s distribution agreements have constrained the query volumes of its rivals, thereby inoculating Google against any genuine competitive threat.”

Like Google, Microsoft appealed. A court overturned its break-up order and the two sides settled on a compromise in 2001. The same could happen with Google.

The European experience is also instructive. Europe’s new Digital Markets Act designated Google as a digital gatekeeper, prohibiting the company from ranking its products at the top of many search engine results. For example, search for a flight and Google no longer puts its flight comparison service, Google Flights, at the top. 

So far, the changes have created more concerns than satisfaction. Instead of generating new competition, the DMA-forced changes have degraded products. Europeans no longer receive an immediate list of flights and prices from various airlines. They are directed to various airline sites.

Any change to search is bound to produce winners and losers. Everyone wants to end up on top of the result. That is impossible, of course.

What could change the competitive landscape is innovation. Superior products can bust open monopolies. Consumers will flock to a search engine that is demonstrably better than Google and artificial intelligence could create such a superior product.

In the past, EU antitrust fines and imposed remedies failed to dent the stock price of Google parent Alphabet shares. The Department of Justice break-up plans are different. They caused Alphabet shares to plunge by more than 5%. Yet the shares are already recovering as investors realize that any final resolution of the antitrust war is long off. 

Only one thing seems sure: both Brussels and Washington agree that Google is too big and powerful. At the same time, both seem stumped on how to change that.

Bill Echikson is editor of Bandwidth and a non-resident CEPA Senior Fellow.

Bandwidth is CEPA’s online journal dedicated to advancing transatlantic cooperation on tech policy. All opinions are those of the author and do not necessarily represent the position or views of the institutions they represent or the Center for European Policy Analysis.

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