Perplexity Proposes $34.5 Billion Offer to Acquire Chrome from Google

In a surprising development, the AI start-up Perplexity has made a significant bid of $34.5 billion for Google's Chrome browser. This move comes amid ongoing antitrust proceedings against Google, which might potentially lead to a court-mandated sale of its widely used web browser.

The backdrop of this offer is a legal battle that has been unfolding since 2020, initiated by the U.S. Department of Justice and several states. They allege that Google has been abusing its market dominance by ensuring that its search engine is set as the default on various browsers and devices through financial incentives, thereby stifling competition. In April 2024, Judge Amit Mehta sided with the plaintiffs, indicating that significant consequences could follow, including the possible divestiture of Chrome.

Perplexity's proposal, although exceeding the company's market valuation, is reportedly backed by investors, including major venture capital funds. The offer aims to demonstrate to the court that multiple parties are interested in acquiring Chrome, which is estimated to be valued between $20 billion and $50 billion. Perplexity's bid sits squarely in the middle of these valuations.

Prior to Perplexity's offer, OpenAI had also expressed interest in acquiring Chrome, should the court's ruling necessitate a sale. This interest underscores the broader implications of the antitrust case, as both companies see potential benefits in acquiring the browser. A ruling from the judge is expected within the month.

Perplexity, which has developed its own browser named Comet, based on Chromium and utilizing Perplexity as its search engine, aims to expand its reach. Currently, Comet is available only to a select group of subscribers who pay $200 per month, whereas Chrome dominates the market with over 3.5 billion users, accounting for more than 60% of the browser market share.

Despite the competitive landscape, Chromium, the open-source project at the heart of many browsers, remains widely supported. In addition to Chrome and Comet, other browsers such as Microsoft Edge, Vivaldi, Brave, and Opera also utilize Chromium, collectively commanding nearly 80% of the market.

In its letter to Sundar Pichai, CEO of Google's parent company Alphabet, Perplexity emphasized that the acquisition is intended to comply with antitrust remedies by transitioning Chrome to a competent, independent operator. However, Google has yet to express any intention of selling Chrome and declined to comment on Perplexity's offer.

Perplexity has assured that it would continue to support and develop Chromium post-acquisition, maintaining Google as the default search engine, although users would have the option to change this setting at their discretion. As the antitrust proceedings continue, market analysts remain skeptical about the likelihood of a forced sale of Chrome, with Google expected to pursue all legal avenues available in the event of adverse rulings.