Google has avoided the nuclear option in the biggest antitrust fight since Microsoft in the 1990s.

As Channel News reported last week, the nuclear option – a break-up of the company – was always unlikely, but it remained a possibility.

A US judge has now ruled the search giant acted illegally to preserve its dominance.

Nonetheless, the judge stopped short of forcing the company to sell its Chrome browser or Android operating system.

The decision comes a year after Judge Amit Mehta found Google had monopolised internet search for more than a decade through restrictive distribution deals.

The Department of Justice had pushed for sweeping remedies, including breaking off Chrome from Google.

Instead, Mehta barred Google from striking exclusive arrangements with device makers and browser companies.

It also ordered Google to share some search data with rivals.

In practice, that means Google can no longer require Android partners to preload Chrome, Search, Gemini or Google Assistant to gain access to the Play Store.

Nor can it tie revenue-sharing to app placement.

However, the company is still free to pay Apple more than US$20 billion a year (A$29 billion) to remain the default search engine on Safari.

The verdict could have been worse for a company that once prided itself of not being evil

Google has argued that the rise of ChatGPT and Microsoft’s Copilot shows the market is more dynamic than regulators admit.

Critics, including the American Economic Liberties Project, blasted the ruling as “feckless” given the scale of Google’s illegal conduct.

Mehta’s judgement noted that generative AI is already reshaping search competition. “There are strong reasons not to jolt the system and to allow market forces to do the work,” he observed.

Google said it will comply but flagged privacy concerns over mandated data-sharing. The Justice Department is weighing an appeal.

While Mehta has blinked on structural remedies, the decision still narrows Google’s distribution tactics in ways regulators here and in Europe will study closely.

The ACCC has already shown a willingness to scrutinise big tech’s market power, most visibly in its News Media Bargaining Code battle.

If American courts force Google to share search data and loosen default contracts, that could embolden the ACCC to push harder on local competition concerns.

That could give smaller search players and AI-powered upstarts a better shot at reaching Australians.