There is a ton of chatter about a Justice Department anti-trust investigation into Google. There is no question that Google dominates search. See the following search engine market share chart from Compete:
And everyone knows that Google derives the vast majority of its revenues and pretty much all it’s profits from the search business – something like 90%+ of it’s revenue is from search related advertising.
So, my question is, if the Justice Department does something really aggressive and crazy and decides that Google needs to be broken up, how would they possibly split the business? No one can possibly claim that Android, Google Docs, and other industry leading properties that Google has developed are cash-flow generating independent, fully fledged businesses on their own. Despite the massive user adoption for these products, in their current form they are more of “scorching the earth” defensive products instead of stand-alone companies. If they were carved out of the company then they’d need pretty deep private equity type backers to get them to a profitable form. Not impossible to imagine this happening (i.e. a PE group wanting to fund them for the chance at massive upside) but it doesn’t feel like the traditional AT&T/Baby Bell breakup.
I guess there is the Microsoft example where various governments forced MSFT to stop forcing computer companies to bundle IE or something like that. But how would you stop Google from giving away Android to mobile handset makers? Force them to start charging for it or something? I just don’t get it.
Anyone have any idea what type of action a government would take to punish Google for their search domination?