Did Google Just Get Spared? Investors Think So.

DealBook|Did Google Just Get Spared? Investors Think So.

Andrew here. Ponder this: The judge in the Google search antitrust case has made a big ruling — which we get into below — that prevents Google from paying rivals to be their “exclusive” provider of search. But the decision also allows the company to continue to pay others like Apple to be a default search provider. What’s the difference? The answer is unclear. Could Apple, whose stock jumped on the news because it gets $20 billion a year from Google, still sell its search bar to Google while selling access to others, too?

We also take a look this morning at the breakup of Kraft Heinz, and the latest on the tariff drama.

Hitting the brakes on Big Tech antitrust

Google shareholders are breathing a sigh of relief after a federal judge spared the tech giant from the harshest possible punishment for violating federal antitrust law: a breakup.

Though the Justice Department praised Tuesday’s ruling as a win for competition in Silicon Valley, the real outcome could be that efforts to constrain the power of Big Tech may have limited effects.

“Courts must approach the task of crafting remedies with a healthy dose of humility,” Judge Amit Mehta of the U.S. District Court for the District of Columbia wrote in his ruling, outlining steps Google must take to address its illegal monopoly over web search. They include:

• Stop paying makers of web browsers and smartphones for exclusive rights to provide search, and from requiring its other products to be bundled on a device

• Share some of its search data with “qualified competitors,” potentially including rivals like Microsoft and DuckDuckGo

What he didn’t do: require Google to sell its Chrome browser, something the government had called for, or block it from paying for prime — but not exclusive — placement of its search engine.

Some big winners from the ruling:

• Google itself, with its shares leaping 8 percent in after-hours trading

• Apple, whose multibillion-dollar search arrangement with Google will most likely continue; its shares jumped 4 percent in post-market trading

• Mozilla, which gets nearly all of its U.S. revenue from a deal that makes Google the default search provider for its browser

The artificial intelligence boom may have spared Google. Mehta specifically cited the rise of generative A.I. companies as a factor in his ruling, with chatbots now providing stiff competition. They also have astonishingly deep pockets to battle Google: Just on Tuesday, Anthropic said it had raised $13 billion at a $183 billion valuation.

“These companies already are in a better position, both financially and technologically, to compete with Google than any traditional search company has been in decades (except perhaps Microsoft),” Mehta wrote.