Google Chrome Should Be Sold, DOJ Says. Why Alphabet Stock Has Barely Budged

The Biden administration wants to force Google to ditch its Chrome web browser. Investors in parent company Alphabet shouldn’t sweat it.

The Justice Department said late Wednesday that Google should have to sell its web browser Chrome.

The Justice Department said in a court filing late Wednesday that the Big Tech company should be forced to sell its web browser, as part of a push to end its monopoly in online search. Plaintiffs said Google has inflicted “decadelong harm” on the market and “must divest Chrome” to fix that.

Google didn’t immediately respond to a Barron’s request for comment.

In a statement, Kent Walker, Alphabet and Google’s chief legal officer, said the DOJ had submitted a “staggering proposal” that “goes miles beyond the court’s decision” and “would break a range of Google products.”

The company’s vice president for regulatory affairs Lee-Anne Mulholland said previously that the government “putting its thumb on the scale in these ways would harm consumers, developers and American technological leadership.”

The market didn’t seem too fazed. Alphabet shares edged down 0.3% ahead of Thursday’s opening bell, while futures tracking the benchmark S&P 500 rose 01.%.

Chrome is a relatively small part of Google’s business—it would go for as much as $20 billion if divested, according to Bloomberg Intelligence. As of Wednesday’s close, Alphabet had a market valuation of $2.2 trillion, more than 100 times that.

Even if the spinoff did happen that doesn’t mean users would ditch Google’s search engine for rivals such as Bing and DuckDuckGo, which account for less than 10% of the overall market.

There is also the possibility the breakup doesn’t actually happen. Legal scholars see Judge Amit Mehta, who will oversee a trial starting in April to decide how to address Google’s illegal monopolization, as being likely to follow precedent.

That doesn’t mean the breakup will actually happen. Legal scholars see Mehta as a by-the-book judge who is likely to follow precedent.

The closest parallel is a case that happened almost a quarter of a century ago. In June 2000, a judge ordered the breakup of Microsoft—but that decision was later reversed on appeal. Google has plans to appeal any ruling here, too.