Perplexity explores buying web browsers to expand reach

Perplexity, an AI search startup, has explored acquiring a range of web browsers as it seeks to expand its reach, according to sources.

Since late last year, Perplexity executives held talks with The Browser Co., Brave, and met with DuckDuckGo’s CEO about browser acquisition strategies, but none led to a deal.

Earlier this summer, Perplexity reportedly offered to buy Brave, a San Francisco-based privacy-focused browser and search engine, for about US$1 billion in stock, but the two sides did not agree on terms.

These efforts come as Perplexity positions itself against search giants like Google, with 260,000 paying subscribers by the end of last year and recent funding rounds that valued the company at up to US$18 billion.

Perplexity has also made smaller acquisitions, including Sidekick and Invisible, to strengthen its AI capabilities.

🔗 Source: The Information

🧠 Food for thought

1️⃣ Browser acquisitions have historically delivered mixed results despite massive investments

The history of browser acquisitions reveals a pattern of ambitious bets that often fail to deliver expected returns, even when involving experienced players and substantial capital.

AOL’s $4.2 billion acquisition of Netscape in 1999 serves as a cautionary tale. Despite Netscape being a leading browser at the time, it ultimately lost market share to Microsoft’s Internet Explorer and failed to justify its massive price tag1.

This contrasts with Google’s more successful acquisition strategy, where smaller, strategic purchases like Android for approximately $50 million and YouTube for $1.65 billion became foundational to the company’s dominance2.

The difference suggests that timing, integration capability, and market dynamics matter more than the target’s current market position.

Perplexity’s interest in smaller browsers like Brave (reportedly valued at $1 billion) and The Browser Co. reflects a more measured approach compared to its headline-grabbing $34.5 billion Chrome bid.

2️⃣ Browser distribution remains critical for search dominance despite the AI revolution

Chrome’s strategic value extends far beyond its 63% market share, serving as a crucial gateway that channels user behavior and search queries3.

According to federal court findings, about 20% of all US search queries flow through Chrome browsers downloaded by users, while another 50% default to Google through preinstalled browsers like Chrome and Safari.