Alphabet’s stock dropped 4% on Thursday following the U.S. Department of Justice's (DOJ) proposal that Google divest its Chrome browser to address its antitrust case.

According to court filings submitted by the DOJ late Wednesday, the proposed divestiture aims to “permanently end Google’s control over this critical gateway for search access and allow competing search engines to access the browser, which serves as the gateway to the internet for many users.”

If accepted, the proposal would prohibit Google from owning a browser and reentering the browser market for the next five years. Additionally, the DOJ has requested that Google divest investments in search engines, generative AI products, and advertising technologies within six months.

This development comes as Google’s antitrust case enters a critical phase with the anticipated reappointment of a new DOJ leadership under the Trump administration. It marks the latest escalation in years of bipartisan efforts to counter Google’s dominance.

In August, a federal judge ruled that Google’s monopolistic practices in search and text advertising violated Section 2 of the Sherman Act. This DOJ initiative is the most aggressive attempt since the 2001 Microsoft antitrust settlement to dismantle a tech giant.

Chrome, introduced by Google in 2008, collects user data that feeds its targeted advertising business. The DOJ stated that forcing Google to relinquish Chrome would create a fairer competitive environment for rival search engines.

Google Strongly Opposes, Citing “Consumer Impact and Tech Competitiveness”

Unsurprisingly, Google has vehemently opposed the proposal, describing the DOJ’s demands as “shocking and overly aggressive.”

Google argues that divesting Chrome and its Android operating system would harm consumers since these products are currently free and operate as “loss leaders” to promote its search and advertising businesses. The company emphasized that no other firms could sustain the investments necessary to keep browsers secure and competitive.

Additionally, Google warned that the measures could severely impact its AI investments, undermining its leadership in global technology.

A 23-page DOJ filing stated, “To address these harms, the proposed final judgment requires Google to divest Chrome, permanently ending its control over this critical gateway for search access and allowing rival search engines to compete. For many users, this browser serves as the gateway to the internet.”

DOJ Seeks Broader Restrictions Beyond Chrome*

The DOJ also called for bans on Google’s exclusive agreements with third parties, such as Apple and Samsung, and restrictions on search service preferences integrated into its other products.

Moreover, the DOJ proposed remedies to prevent Google from eliminating “emerging competitive threats” through acquisitions, minority equity investments, or partnerships. These remedies would last for 10 years.

“The proposed remedies are designed to terminate Google’s unlawful conduct and open the market to competitors and new entrants,” the DOJ stated.

In Q3, Alphabet reported $49.4 billion in search ad revenue, accounting for three-quarters of its total ad sales for the quarter.

DOJ Considers Divesting Android, but Suggests Alternative Remedies*

While the DOJ acknowledged that forcing Google to divest its Android mobile operating system could restore competition, it recognized that such a move might face significant opposition.

Instead, it proposed other remedies aimed at reducing Google’s ability to leverage control over the Android ecosystem to support its general search services. If these measures fail to provide meaningful relief, the court may revisit the Android divestiture proposal.

Google Plans to Appeal Antitrust Ruling*

Google’s Chief Legal Officer Kent Walker criticized the DOJ’s proposals in a Thursday blog post, describing them as “overreaching” and likely to undermine privacy protections and AI investments at a crucial time.

Walker added that the remedies go “far beyond the court’s rulings” and would disrupt Google’s product ecosystem, extending well beyond search.

Google has announced plans to appeal the antitrust ruling, which will likely delay any final decisions on remedies.

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