What if Google Was Forced to Divest?

Google has achieved unprecedented growth levels driven by its flagship, i.e. its unparalleled search engine with its unique features.

However, as a result of this immense success, Google has also faced increased pressure from regulators across the globe, and more recently, from the US, in order to divest, and literally become a smaller company.

In the eyes of regulators, Google has grown too big and spread its operations massively based on its dominant search engine, to such an extent that they could well justify their allegation that Google has taken advantage of its monopolistic position in the search engine market.

This alleged monopolistic power that results from Google’s search engine has allowed Google to become a tremendously profitable company through its advertising service, Google Ads.

Ultimately, the revenues amassed by Google with time has allowed it to grow even more every year, with other search engine operators being left behind, as they are unable to compete with it.

What if Google had to stop using Google Ads on its search engine?

Google Ads is how Google makes big money from its search engine.

Google’s search engine wouldn’t be the same without Google Ads.

These ads that are placed alongside Google’s organic (that is non-ad and non-paid) search engine results are actually Google’s breadwinner.

Google has developed a sophisticated technology to match organic with paid search engine results, and this technology has been a major contributor to Google’s financial success over the years.

Can you imagine, for example, Google running Microsoft Ads on its own search engine?

Although this may seem to be a science fiction scenario, it would not be the first time that two ‘big boys’ of the Internet clinch such a deal.

It was back in 2015, when Yahoo signed a deal with Google to run the latter’s ads on its online properties, so it wouldn’t come as a surprise if a similar deal was reached between Google and one or more key players in the online advertising market.

In this way, Google could still monetize its search engine by diverting part of its advertising income to another company.

What if Google decided to make its search engine subscription-based for its users?

If lawmakers rule that Google’s search engine monetization model must be cut apart in two divisions, that is a search engine division, and an advertising division, which must be run independently, and not be associated in any way with each other, and Alphabet Inc., which is the holding company of Google, fails to reach an agreement with an online advertising company to run ads on its search engine, there could be on option for Google to become a subscription-based service.

This would mean that the users of Google’s search engine would have to pay a fee to use it, which is something that they currently do for free.

Since its launch, Google has offered its search engine service to its users for free, and this has been the cornerstone of the free flow of information on a global level.

If Google users had to pay a fee to use it, a number of them would shift to rival search engines that would still be free to use.

It should be mentioned that Google has already introduced a subscription, ad-free option to its YouTube users.

Would the online advertising market be more efficient and fair if Google divested?

Google’s rival search engines are operated by other big Internet names, such as Microsoft, which runs Bing.

Therefore, if Google was forced to divest, this could result in breaking a potential monopoly, i.e. Google’s, and possibly giving rise to a new one, i.e. Microsoft’s.

In fact, the lawmakers’ ruling would not remedy literally anything in the long run.

On the other hand, if Google chose a small advertising company to share its search engine profits with, this would improve market competition, thus offering the opportunity to a smaller player to get a slice of the pie and grow, finally leading to stronger and fairer competition that would benefit consumers, i.e. search engine users, who would theoretically be offered more and better options.

Finally, if Google decided to charge its search engine users, this would dramatically change the landscape that currently applies to the online search engine market, with the impact of such a decision seeming impossible to measure and estimate at the moment.

Sources and further reading:

How Google Makes Money: 6 Ways

Yahoo Signs Deal With Google

Imagining A World In Which Google Is Forced To Divest GAM

Google Charged With EU Antitrust Violation—And May Be Forced To Sell Part Of Its Ad Business