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Limited proposals contrast sharply with government's broad

push

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Agreements could be made non-exclusive, Google says

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Google still plans to appeal once the case is finished

By Jody Godoy

Dec 20 (Reuters) - Alphabet's Google proposed

on Friday a loosening of its agreements with Apple ( AAPL ) and

others to set Google as the default search engine on new devices

to address a U.S. ruling that it unlawfully dominates online

search.

The proposal is much narrower than the government's bid to

make Google sell its Chrome browser in the antitrust case over

online search.

Google urged U.S. District Judge Amit Mehta in Washington to

move cautiously in deciding what the company must do to restore

competition after his ruling that the company holds an illegal

monopoly in online search and related advertising.

While Google plans to appeal that ruling at the end of the

case, it says the upcoming "remedies" phase should focus on its

distribution agreements with browser developers, mobile device

manufacturers, and wireless carriers.

The judge found the agreements give Google a "major, largely

unseen advantage over its rivals" and result in most devices in

the U.S. coming pre-loaded with Google's search engine.

The agreements are hard to exit, the judge said, especially

for Android manufacturers, which must agree to install Google

search in order to include Google's Play Store on their devices.

To fix that, Google could make them non-exclusive and,

for Android phone manufacturers, unbundle its Play Store from

Chrome and search, the company said in court papers.

Unlike the government's proposal, Google's would not end

revenue sharing agreements, which pass a portion of ad revenue

Google makes off of search users to the device and software

companies that present it as the default search engine.

Independent browser developers including Mozilla, which

makes Firefox, have said the funds are crucial to their

operations. Apple ( AAPL ) received an estimated $20 billion from its

agreement with Google in 2022 alone.

Google's proposal sets the stage for a trial Mehta will hold

in April, where the U.S. Department of Justice and a coalition

of states will seek to show the need for wide-ranging remedies,

including making Google sell off Chrome and potentially its

Android mobile operating system.

Prosecutors also want Google to stop paying to be the

default search engine, and cease investments in search rivals

and query-based artificial intelligence products, and license

its search results and technology to rivals.

Prosecutors say the proposals aim to spur innovation in

online search, where Mehta found Google's overwhelming market

share keeps competitors from gathering the search data needed to

improve their products. Prosecutors also seek to prevent Google

from extending its dominance in search to AI.

(Reporting by Jody Godoy in New York; Editing by Muralikumar

Anantharaman)