Perplexity AI’s $34.5B Chrome Browser Bid: A David vs. Goliath AI War

Key Takeaways:

• Perplexity AI offers $34.5 billion all-cash for the Chrome browser.
• Acquisition would give the AI firm instant access to Chrome’s more than 3billion users.
• Bid comes as DOJ pushes Google to divest Chrome browser in antitrust case.
• Perplexity plans to keep Chromium free while investing $3 billion in development.

The Billion-Dollar Browser Battle

This could be one of the most audacious power plays of the decade in the Silicon Valley space: AI startup Perplexity just threw a $34.5 billion offer to acquire the very well-known browser Google Chrome (reported first by the Wall Street Journal), representing a big bet for controlling the world’s largest browser (68% market share), and the best way to win the Artificial Intelligence (AI) battle.

To put it into context:

• Perplexity has only raised $1 billion to date (backed by Nvidia/SoftBank)
• Chrome browser is not officially for sale, and Google is preparing to fight the Department of Justice (DOJ) divestment demands
• The bid is more than Perplexity’s entire valuation of $18 billion, at the time of writing

Let’s have in mind that a browser (like Chrome) is the front door to the internet.

Why The Chrome Browser? Why Now?

Perplexity CEO Aravind Srinivas is not shy about what he wants. With his company’s AI-based Comet browser struggling to get traction, acquiring Chrome would:

1. Eliminate Google’s advantage on their own turf in AI search (Chrome browser having Google Search as default)
2. Give the firm free behavioral data from more than 3 billion users to train AI models
3. Outperform competitors such as OpenAI, which is building its own browser

This is happening right when Google is dealing with its antitrust problems. A judge ruled last year that Google illegally monopolized the “search” sector, and then the DOJ suggested selling off Chrome as a possible fix. Nevertheless, Google’s planning to appeal, but Perplexity’s quick move puts them in a good spot to step in if Google has to step down.

The Fine Print

Perplexity’s offer includes some interesting concessions, for example:

• No changes to search engine: Google would stand as Chrome’s default (for now)
• Investment of $3 billion in Chromium’s open-source ecosystem
• All-cash scheme (backed by undisclosed investors)

Some critics think this is like a publicity stunt, suggesting this is like a lemonade stand offering to buy Coca-Cola. But with SoftBank Group Corp. (SFTBY) stock soaring more than 7% on the news, markets may see strategic logic.

What Comes Next?

Three groups are splitting up the responsibilities:

First, Google is likely to reject the offer unless the DOJ forces its hand. Second, Judge Amit Mehta’s remedy ruling from the Regulators’ side is expected this month. Last but not least, investors, Perplexity must show it can arrange $34.5 billion of financing.

In the meantime, it looks like a bidding war might be brewing for the Chrome browser, with Apollo Global Management and OpenAI reportedly in the running too.

AI’s New Frontier

Perplexity’s recent move highlights a brave turn: browsers keep evolving beyond simple web portals to become crucial AI training environments. Regardless of the outcome, this endeavor shows that future internet dominance will be not only on search algorithms but on controlling the interfaces that deliver them.

Final Thought: Ultimately, this may be less about acquiring a browser and more about acquiring time, time for an AI underdog to change the game before titans like Google completely change course and adapt.

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For more AI-related stories, read: Coinbase & Perplexity AI Team Up: Real-Time Crypto Insights Just Got Smarter