If American justice forces Google to separate from Chrome, it will lose a large part of its dominance in online advertising and would put a blow to its AI strategy.
In a famous scene from the series Mad Men, reacting to the ban on tobacco companies using health arguments in their advertisements, Don Draper claims that this is the greatest opportunity in the advertising industry since the invention of cereals. There is no doubt that the main protagonist of the series would have also been enthusiastic about the current anti-monopoly trial being carried out in the United States against Google, which also promises to radically transform the world of advertising.
In August, a US federal court ruled that Google had a monopoly on online search, violating Section 2 of the Sherman Antitrust Act of 1890, which prohibits monopolies. The court thus considered that Google was taking advantage of its dominant position to create strong barriers to entry in order to pull the rug out from under its competitors. The culmination of a trial started four years earlier, in a context of increasing severity from the American authorities in the face of the dominant position of the technological giants. We have since been waiting for the American Department of Justice to propose solutions to remedy this situation, the most radical being a dismantling of the company.
Chrome, at the heart of the war machine
In mid-November, the Justice Department took a step in this direction, suggesting that forcing the California giant to sell its Chrome browser would open up more opportunities for Google's competitors in the online search market. “Selling Chrome will prevent Google from controlling this critical access point to search, and allow rival engines access to the browser that, for so many users, is the gateway to the Internet.” we read in a 23-page document published by the Department of Justice.
If confirmed, this decision would be cataclysmic for Google. Indeed, for the company, Chrome is not just a simple Internet browser. It is at the heart of its advertising machine, which makes the company a formidable cash machine.
Around 90% of total web searches go through Google, and 60% of internet users use the Google Chrome browser. This makes it by far the most used browser in the world, ahead of Apple's Safari (18% market share). However, Chrome allows Google to collect a large amount of additional data beyond the search itself, such as additional searches carried out by the user, their location, the way they react to certain advertisements rather than to other searches. others, as well as their favorite sites. A kind of Spyware on a global scale.
“All activities carried out by Internet users on the Chrome browser are collected by Google and feed the company's ability to carry out targeted advertising, with a precision that allows it to differentiate itself in the market. Chrome constitutes a means of centralizing the different bits of information about everything the Internet user does online”, summarizes Mike Shields, an independent consultant specializing in online media and advertising.
An expertise that proves extremely lucrative. In 2023, Alphabet Group generated more than $230 billion in advertising revenue, which represents the vast majority of the money generated by the company ($307 billion in total). Google alone accounts for 28% of total advertising revenue generated worldwide!
Chrome is also a good way for Google to promote its own products and keep users in its ecosystem, which includes for example Gmail for email and Gemini for generative artificial intelligence (AI).
The consequences of possible dismantling
A dismantling would mean for Google the loss of access to the data it collects today via Google Chrome, and an obligation to deal with increasingly restrictive laws regarding the protection of the privacy of Internet users, according to Jason Kint, head of Digital Content Next, a New York-based nonprofit producing research on the digital economy.
“If Chrome becomes an independent company, the data it collects constitutes data held by a third party, which triggers privacy laws. Google should therefore find a way to have a right to access to this data if he wants to continue to be able to use them.
In the United States, there are currently no federal laws in this regard, but a variety of state laws. In California, where Google is headquartered, it would have to ask Chrome users for the right to collect this data, and if they refused, it would be unable to do so. Google could try to get around the problem by relying more on data collected through their other apps, like Gmail, or through Android, but that would still be a big risk for its business model.
Chrome & Generative AI
But Chrome isn't just the cornerstone of Google's advertising model. At a time when the Californian giant is waging a fierce fight against its rivals like Meta, Microsoft and OpenAI around generative AI, its domination of online search, boosted by Chrome, is a considerable asset for accumulating large quantities of data necessary to feed generative AI models, and continuously enrich them.
“97% of searches carried out online go through Google. In the era of generative AI, where it is a question of training large language models with immense quantities of data, this is a clear advantage over competition Google's dominance in online search is also a huge asset for augmented retrieval generation (ARG): when someone asks the AI a new question, Google can understand the context much better than its competitors. , thanks to its access to internet data”, says Jason Kint.
Of course, forcing it to part ways with Chrome wouldn't mark the end of Google's dominance of online search. But if, as the American Department of Justice hopes, this helps stimulate competition in this area, it would indeed mark the end of Google's undivided domination of search, depriving the company of its best asset in the face of to rivals like Microsoft, Anthropic, Mistral and OpenAI on generative AI.
