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MONOCHROME

Google may have to sell off Chrome — but who could buy it?

Forcing a sale of Google Chrome could weaken Google’s stranglehold on search.

11/19/24 9:50AM

“Which lawyers did Microsoft use for its antitrust case in 2000” — Google execs this morning, probably.

Done searching

According to a report from Bloomberg yesterday, Department of Justice officials are planning to recommend that Amit Mehta — the US District Judge who ruled in August that Alphabet’s search giant holds an illegal monopoly over the market — force the company to sell off its Google Chrome browser, impose data-licensing requirements, and implement measures around the company’s Android operating system and burgeoning AI efforts.

Those recommendations show just how serious America’s antitrust authorities are about cracking down on Google’s dominance in the world of looking stuff up online. It’s the biggest antitrust action against Big Tech in the US since the United States vs. Microsoft Corp. case more than two decades ago (spoiler: Microsoft wasn’t broken up).

According to Statcounter, Google Chrome has a 67% share of the global web-browser market — way ahead of the next biggest competitor, Apple’s Safari, the default browser on every iPad and iPhone (unless users switch their settings). Though Chrome isn’t a huge money spinner in a direct sense, being free to download and use, it’s a phenomenal source of traffic for the search engine itself, which makes plenty of money (some $49 billion last quarter). On Chrome, users are sent straight to google.com by default when they search, and Google gets data on what logged-in users are doing, helping its targeted-advertising efforts.

Google Chrome market share — Sherwood News

Gatekeeping gateway

While Chrome was never really the product at the heart of the DOJ’s lawsuit, which was first launched under the Trump administration in 2020, the browser plays a massive part in the crux of the case — Google’s total domination of search. According to website-intelligence platform Similarweb, google.com has a staggering 93% share of American web searches.

Google market share searches (Similarweb) — Sherwood News

That level of domination, as antitrust expert George Hay simplified for Sherwood News in the wake of the August ruling, amounts to a monopoly which Google monetizes with advertising and cements via exclusive deals with the makers of Apple and Android devices. Thanks to unsealed court documents, we know that Google paid Apple an eye-watering $20 billion in 2022 alone to be the default search engine in Apple’s Safari browser. If Chrome was owned by someone else, Google would presumably have to pay to be the default search engine in a similar fashion.

The obvious complication with forcing Alphabet to sell Google Chrome is that it’s really big. There’s not that many companies that could afford and make use of an internet browser that has hundreds of millions of users and, from the small pool of competitors that could (e.g. Amazon, Microsoft, Apple), which of them would be impervious to the same monopoly charges further down the line? While such recommendations might work in theory, breaking up Google in practice, as Rani Molla observed in August, will prove hard to do.

Rani Molla

AI AI AI

What Amazon’s latest data center announcement says about AI right now

The first Amazon data centers in Louisiana will cost $12 billion and require a lot of preemptive defense.

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Anthropic says that a group of Chinese AI startups are “distilling” their models by setting up huge numbers of fake accounts for Claude AI. In a blog post, Anthropic said that it disrupted “industrial-scale” campaigns by Chinese AI labs DeepSeek, Moonshot, and MiniMax. The company said that the group had over 16 million exchanges with Claude, after setting up 24,000 “fraudulent” accounts. Anthropic said it is developing countermeasures to prevent such attacks in the future.

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Report: OpenAI’s Stargate has been a chaotic mess

Just over a year ago, OpenAI CEO Sam Altman stood alongside President Trump, Oracle’s Larry Ellison, and SoftBank CEO Masayoshi Son to announce an ambitious $500 billion plan to build massive data centers in the US — Project Stargate.

While today an actual Stargate 1-gigawatt data center is certainly well under construction in Abilene, Texas, it turns out there wasn’t much of a plan in place at the time of the announcement, according to a new report from The Information.

The past year has been full of partner disputes, debt problems, and scuttled plans as the loosely defined project races to build the AI computing infrastructure that OpenAI is craving as competition heats up.

Per the report, OpenAI tried to build its own data centers as the project stalled, but lenders balked at funding the risky project. They eventually settled on the current plan, in which partner Oracle borrows the money and leases capacity back to OpenAI. OpenAI was still able to control the design of the facility.

The slow start for the project resulted in OpenAI missing its own goal of 10 gigawatts of AI computing capacity from Oracle and SoftBank by the end of 2025.

Inside OpenAI’s Scramble to Get Computing Power After Stargate Stalled

The slow start for the project resulted in OpenAI missing its own goal of 10 gigawatts of AI computing capacity from Oracle and SoftBank by the end of 2025.

Rani Molla14h

Ives says AI represents huge opportunity for cybersecurity firms as losses mount

Cybersecurity stocks continued to slide Monday, after Anthropic unveiled a new security feature for its AI model Friday. The company’s AI advancements have been wreaking havoc across software firms, and its latest foray appears to be doing the same to cybersecurity leaders, including CrowdStrike, Zscaler, and Cloudflare.

But similar to Dan Ives’ broader thesis on the software sell-off — which he has called “overblown,” arguing that the companies getting hit may ultimately become “core participants in the AI Revolution” — the Wedbush Securities analyst says AI is actually a positive for cybersecurity stocks.

“Anthropic going after this market with an initial tool validates our thesis that cyber security is the next frontier for the AI Revolution,” Ives wrote Monday morning, arguing that AI is elevating the risk environment — and the need for cybersecurity firms in the first place.

“AI will be a major tailwind to the cyber security sector over the coming years as protection of use cases, data, and endpoints expand markedly,” he said, adding that companies including CrowdStrike and Zscaler are well positioned to capitalize on the shift by incorporating AI into their strategies.

Rani Molla16h

Analysts slash Salesforce price targets ahead of Wednesday earnings, as narrative of AI eating its lunch persists

A number of analysts have significantly lowered their price targets for Salesforce, citing growing fears that AI workforce tools, including Anthropic’s Cowork, could threaten parts of its core business. According to reports, here are some of the recent cuts:

Morgan Stanley cut its price target nearly 30%, to $287 from $398.
Jefferies slashed its forecast 33%, to $250 from $375.
Barclays reduced its price target to $265 from $338.
Evercore ISI went to $260 from $340.
Last week, Citigroup also reduced its price target to $197 from $257.

Earlier this month, Wedbush Securities analyst Dan Ives offered a different view, adding Salesforce to his list of top 30 AI companies and calling the stock a “core participant” in the “AI revolution.” He described the recent software sell-off as “overblown.”

Shares of Salesforce, which reports earnings Wednesday, are down 30% year to date and 1% premarket today.