AI Startup Perplexity Makes $ 34.5 Billion Bid to Take over Google’s Chrome Browser
Perplexity AI claimed to offer unsolicited tandem cash proposal worth $34.5 billion to acquire Alphabet chrome browser that would essentially entail financing orders of magnitude higher than the valuation of Perplexity AI itself.
Managed by Aravind Srinivas, Perplexity itself has a history of headline-generating proposals, having also pitched a related takeover idea to TikTok U.S. in January, proposing to buy the popular short-video app and bring it back under U.S. ownership.
Purchasing Chrome would enable the startup to leverage the three billion plus users of the browser to gain a competitive advantage in the AI search, as Google faces competitive pressure to monopolize its industry due to regulatory pressure.
The firm has not been selling Chrome and it is appealing a ruling last year by a U.S. court that it had an unlawful monopoly on online search. Divestiture in Chrome is one of the remedies that the Justice department has been pursuing in the case
The three year old company has raised around $1 billion in funding so far from investors including Nvidia and Japan’s SoftBank. It was last valued at $14 billion.Multiple funds have offered to finance the deal in full, a person familiar with the matter said, without naming the funds.
As a new generation of users is finding the answers in chatbots like ChatGPT and Perplexity, it seems that the web browser is once again becoming a critical conduit to search traffic and valuable user data, and therefore pivotal to Big Tech’ AI ambitions.
Perplexity already has an AI browser, Comet, that can do some things on a user account and the acquisition of chrome would give them the weight to compete better with larger competitors like OpenAI. Its parent company, ChatGPT has also shown interest in acquiring Chrome and developing the chatGPT AI browser.
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Perplexity’s bid pledges to keep the underlying browser code called Chromium open source, invest $3 billion over two years and make no changes to Chrome’s default search engine, according to a term sheet seen by Reuters. The company said the offer, with no equity component, would preserve user choice and ease future competition concerns.
Analysts have said Google would be unlikely to sell Chrome and would likely engage in a long legal fight to prevent that outcome, given it is crucial to the company’s AI push as it rolls out features including AI-generated search summaries, known as Overviews, to help defend its search market share.
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A federal judge is expected to issue a ruling on remedies in the Google search antitrust case sometime this month.Perplexity’s bid is also below the at least $50 billion value that rival search engine DuckDuckGo’s CEO, Gabriel Weinberg, suggested Chrome may command if Google was forced to sell it.
Besides OpenAI and Perplexity, Yahoo and private-equity firm Apollo Global Management have also expressed interest in Chrome.