Perplexity move to buy Chrome is more bluster and less reality
On the face of it, Google Chrome is not for sale. Google Chrome is part of Google, and not a separate public company that can be acquired in a hostile takeover. If it has to be sold, then it will have to be sold by Google, and for now, Google has made no indication that it is going to offload its Chrome division. So, why at all is Perplexity making such a public offer? That is because of the antitrust ruling against Google, which forms the backdrop to this bid. According to The Wall Street Journal, US District Judge, Amit P Mehta — Srinivas, Pichai and Mehta, a lot of Indian-origin people are involved in this story — recently found that Google acted illegally to preserve its monopoly, mainly by paying billions of dollars to make its search engine the default on browsers and devices. The judge is now considering remedies, which could in theory include forcing Google to sell Chrome. Google, on its part, has said it will appeal. Until that appeal has been exhausted, there is little chance of an imminent forced sale.Little, but the chance is there. And it is this crack that Perplexity is exploiting as it makes its public bid. However, the ground realities also mean that it is nearly impossible for Perplexity to buy Chrome even if it were available. The key bit here is that Perplexity is just too small. The company has so far raised $1 billion from various sources, and its entire private valuation is estimated to be around $18 billion. In such a scenario, how it will fund a purchase of Chrome for $34.5 billion becomes an interesting question. The only way for the company to manage this would be with the help of borrowings or some sort of largesse from a bigger tech company. But that brings another question? Why would someone lend money to a (relatively) small company like Perplexity to purchase something like Chrome, which outside of Google, might not even be all that valuable? There are no good answers at the moment. A bluster and PR exerciseadvertisementInstead of being a serious bid, the move from Perplexity seems like a classic bluster that the Srinivas-led company makes from time to time. This three-year-old AI company is known for making bold public moves, and it is no stranger to headline-grabbing announcements. Earlier in late January, it wanted to buy TikTok's US operations. But that didn't go anywhere. More significantly, such announcements from Perplexity help it create a lot of buzz. One X user said that Perplexity CEO Aravind Srinivas has essentially bought himself 'free press' by getting millions of people to search for what Perplexity is. In the process, the company sets a price floor for Chrome if any real negotiations ever occur. Even if it never comes close to raising the money, it has already achieved a marketing win.advertisementThis is a view also endorsed by M G Siegler, a tech blogger and former partner at Google Ventures. Siegler is well-connected in Silicon Valley. On his website, Siegler wrote, 'Perplexity's move is clearly a publicity stunt, and I respect the hustle to continually get (media) to write about your company. And it has the added benefit of adding pressure to the antitrust case, trying to showcase to the judge that others would be willing to buy Chrome from Google.'Yes, that impact on the antitrust case that Google is fighting is another valid angle. Several commentators, including Siegler, have highlighted this. 'The Perplexity offer could be an attempt to signal to the judge that there is an interested buyer, should he force a sale,' he wrote on his website.Similarly, another user on social media suggests the offer is really a 'stalking horse bid' designed to influence the antitrust case. The idea is that Perplexity's public interest in Chrome could weaken Google's argument that no viable buyer exists, subtly increasing the odds of a forced divestiture — a result that would benefit Perplexity even without a purchase.So, there you have it. Although the tech circles are busy with buzz around Perplexity and Chrome, a sale is not going to be possible at the moment. But chances are that the sale was also not the aim of Aravind Srinivas when he wrote his letter to Google CEO Sundar Pichai. Instead, the objective was likely to create buzz. And on that count, Perplexity has succeeded.- Ends
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