Baran Baş
With its decision dated 16 May 2025 and numbered 25-02/62-37, the Turkish Competition Board (the “TCB” or the “Board”) unconditionally approved, at the Phase I review, the acquisition of sole control of Galileo AI Inc. (“Galileo”) by Google LLC (“Google”)[2]. The decision, published on the website of the Turkish Competition Authority (the “TCA” or the “Authority”) on 3 June 2025, was adopted by a majority vote, four in favor and three against. Notably, the reasoned decision includes an extensive dissenting opinion that sheds light on a contrasting assessment of the transaction.
In this information note, we take a closer look at the Google/Galileo decision, which stands out both for the reasoning provided by the dissenting Board members and for the majority’s analysis regarding whether the transaction qualifies as a “killer acquisition.”
The Google/Galileo Acquisition
The transaction, whereby Google acquired sole control over Galileo through the purchase of shares from its founders and investors, was notified to the TCA on 20 November 2024[3]. Based on the notification filed with the Authority by the parties, the purpose of the transaction was to integrate a user interface (“UI”) design tool, which was previously unavailable within Google Labs, into the Google Labs ecosystem, which serves as Google’s internal incubator for developer-focused solutions.
Galileo, founded in the United States in September 2022, is a relatively young start-up that enables users to quickly and easily generate user interfaces using generative artificial intelligence (“Gen AI”) based on either text or image prompts. The Gen AI models used by Galileo are not developed in-house; rather, the company relies on third-party open-source Gen AI models, with a focus on UI design functionalities. Its main user base consists of user experience (UX) designers and software developers. By submitting a prompt in either text or image format, users can generate editable UI designs for a wide range of use cases—from product web portals and financial account pages for premium features to online stores, web apps, and product listing pages. These services are also accessible to users located in Türkiye.
The acquiring party, Google is a leading global technology company operating under the umbrella of Alphabet Inc. (“Alphabet”), which is active across a wide range of markets including online advertising technologies, internet search, cloud computing, software, and hardware. Google offers a comprehensive suite of digital products and services such as Google Search, YouTube, Gmail, Google Drive, Google Maps, Google Photos, online advertising solutions, the Android mobile operating system, the Google Play Store, and consumer hardware including Pixel phones and smartwatches. Alphabet is also among the frontrunners in the field of artificial intelligence, with AI-focused products such as Gemini, NotebookLM, and Veo3 positioning the group at the forefront of generative AI development.
The transaction concerned the acquisition of a software tool that allows the generation of UI designs based on Gen AI using text or image inputs. Since Galileo was classified as a technology undertaking under Communiqué No. 2010/4 on Mergers and Acquisitions Calling for the Authorization of the Competition Board, it was not required to meet the Turkish turnover threshold[4]. As Alphabet’s global turnover exceeded the relevant thresholds, the transaction was deemed notifiable and subject to the Board’s approval.
The Board noted that Galileo is not a Gen AI technology provider itself but rather utilizes third-party Gen AI models to offer its services. Furthermore, Google was not considered to be active in the UI design tools software market. Based on this, the transaction was not found to give rise to any horizontal overlaps between the parties. That said, the Board did acknowledge the existence of a potential vertical relationship between the parties, albeit with a limited impact on the Turkish market.
The Majority of the Board’s Assessment Within the Framework of the “Killer Acquisition” Theory
One of the most notable aspects of the Board’s assessment was whether the transaction could be evaluated within the framework of the “killer acquisition” theory. In its decision, the TCB discussed in detail the potential competitive effects of large, established players acquiring young undertakings active in technology markets. The Board first outlined the theoretical framework of the killer acquisition concept, and subsequently assessed its applicability to the transaction at hand.
According to the literature cited in the Board’s decision, start-up undertakings tend to have high competitive potential due to their ability to transform market structures, stimulate efficiency among incumbent players, and drive the development of new technologies. However, when such undertakings are acquired by dominant incumbents in the market, there is a risk that not only the competitive pressure they exert will be lost, but also that potential future innovations may be suppressed. In the literature, such transactions are characterized as “killer acquisitions” because they result in the elimination not only of a potential rival but also of a potential product or technology that could have been introduced to the market. In this context, the Board acknowledged that acquisitions of this kind, particularly common in technology markets, should be assessed not only in terms of their impact on current competition but also with regard to their implications for future innovation dynamics.
The Board stated that for a transaction to be characterized as a “killer acquisition,” three cumulative conditions must be met:
(i) the acquisition of a young and emerging undertaking by a large and established player;
(ii) the acquired technology being discontinued, neglected, or entirely removed from the market; and
(iii) the transaction resulting in the elimination of horizontal competition.
The four Board members who voted in favor of clearing the transaction concluded that these three conditions were not simultaneously present in the case at hand. While Galileo was indeed a young undertaking, the transaction was not considered to result in the elimination of direct competition. It was also noted that Galileo would continue to face strong market players (such as Figma Design and Adobe XD), making it unlikely that any product or technology would be removed from the market as a result of the acquisition. Accordingly, the transaction was not viewed as a “killer acquisition” intended to eliminate competition, but rather as an acquisition combining complementary technologies with potential for synergy.
As a result, taking into account the absence of any affected market in Türkiye, the Board concluded that the transaction would not significantly impede effective competition. Accordingly, the transaction was approved by a majority vote (four in favor and three against).
The Dissenting Opinion: Ecosystem and Innovation-Based Concerns
Although the majority of the Board concluded that the transaction does not eliminate direct competition and therefore does not constitute a “killer acquisition,” three Board members dissented from this conclusion and issued a detailed dissenting opinion. This opinion not only addresses the specifics of the transaction but also offers significant insights into how AI-based ecosystems, which are gaining increasing relevance in digital markets, should be evaluated from a competition law perspective.
According to the dissenting opinion, the Preliminary Investigation Report overlooked the integrated nature of the Gen AI supply-value chain and assessed potential competitive restrictions solely through the lens of horizontal overlaps—thus resulting in an incomplete analysis. However, Google is not merely a provider of user-facing services; it is an integrated digital ecosystem operator active simultaneously across multiple layers of the Gen AI stack, including data, infrastructure, model development, distribution channels, and user interfaces. The user interface technology developed by Galileo represents the final layer of this ecosystem, where direct user interaction takes place, and plays a strategic role in capturing user data.
In this regard, the dissenting opinion argues that focusing solely on whether the transaction creates a direct competitive relationship is insufficient; rather, the risks of input foreclosure and ecosystem-based market foreclosure should also be taken into account.
According to the dissenting opinion, Google’s current generative AI products (Gemini Foundation Models) are already in a superior position compared to their rivals in terms of model access, data processing capacity, and cloud infrastructure, and Google holds the power to set market standards. The dissenting opinion argues that Galileo’s technology is of strategic importance to Google’s Gen AI ecosystem and criticizes the Preliminary Investigation Report for failing to provide a substantive competitive analysis. It also finds fault with the Preliminary Investigation Report’s mere listing of Galileo’s rivals, without any quantitative or explanatory assessment of Galileo’s relative market position.
The dissenting opinion further stresses that traditional market definitions and market share-based assessments may be misleading in digital economies. It underscores that calculating market power based on sales volume or revenue may result in flawed conclusions and that user numbers, visit frequencies, ecosystem scope, and, most importantly, the scale and depth of data ownership have become critical parameters for assessing market power.
Additionally, the dissenting opinion criticizes the Board’s failure to evaluate whether Galileo’s products and services play a critical role in innovation competition or in specific sectors. According to the dissenting opinion, the majority’s finding. According to the dissenting opinion, the majority’s finding that “there is no affected market” is based solely on a horizontal competition framework. In digital market transactions, it is also necessary to examine whether the products involved are interoperable, exchange data, or serve overlapping user bases as complementary services. The dissenting opinion argues that the Board’s decision neglected to explore these potential effects adequately.
Moreover, the dissenting TCB members support their views with references to international precedent. They cite transactions such as Google/AdMob, Google/ITA Software, Sabre/Farelogix, Dow/DuPont, Medtronic/Covidien, and Illumina/Grail, where concerns over suppressed innovation, barriers to entry, and long-term harm to consumer welfare prompted more rigorous scrutiny. They also point out that Google has previously acquired similar start-ups, integrated them into its product suite, and thereby neutralized potential sources of competition.
By referring to established approaches in merger control cases concerning innovation-driven markets—such as Novartis/GSK Oncology, Pfizer/Hospira, Medtronic/Covidien, Dow/DuPont, GE/Alstom, Sabre/Farelogix, Google/ITA Software, Google/AdMob, and Mallinckrodt (Questor)/Synacthen—the dissenting opinion emphasizes that such strategic acquisitions should not be assessed solely based on their short-term competitive effects in the relevant product markets. Rather, the evaluation must also consider their long-term impact on the sustainability of innovation, the entry opportunities for alternative technologies, and the competitive functioning of ecosystems. In this context, it is argued that Google’s acquisition of Galileo would further strengthen its control over the generative AI ecosystem, and that the potential harm to innovation competition and future market entry has not been sufficiently tested. The dissenting opinion thus emphasizes that a more in-depth competitive assessment should have been conducted before the transaction was granted clearance by the Board.
In Lieu of a Conclusion: The Commission’s Silence and Galileo’s Evolution into Stitch – A “Non-Killer” Acquisition?
The transaction was also notified to the European Commission. Under Article 14 of the Digital Markets Act (DMA), gatekeepers are obliged to inform the Commission of any intended concentrations involving undertakings operating in the digital sector or collecting data. In compliance with this notification obligation, Google informed the Commission on 21 November 2024 of its planned acquisition of Galileo[5]. As of now, there is no publicly available information indicating that the Commission has launched a competition investigation into the transaction.
As of June 2025, Galileo has been integrated into Google Labs and relaunched under the name “Stitch.” [6] Google has introduced the new Galileo Stitch as a generative AI tool that enables developers to create complex user interface designs and front-end code within minutes, using text prompts and reference images[7].
It is clear that the way in which Galileo has been integrated under Google’s structure necessitates an assessment of the transaction not only in terms of its short-term competitive effects, but also with regard to its long-term implications for innovation and technology policy. That said, at least for the time being, it appears that Galileo has not been “killed” but rather further developed and repositioned under the name Stitch. In this respect, the transaction may be viewed as diverging from conventional “killer acquisition” scenarios.
[1] Attorney Gülce Korkmaz is the external competition law consultant of Baş | Kaymaz Law Firm. After completing her master’s degree at Bilkent University, she is currently pursuing her doctoral studies in the field of competition law at the Faculty of Law of Lüneburg Leuphana University (Germany) as a PhD researcher with the scholarship of the Joachim Herz Foundation.
[2] TCB Decision dated 16 May 2025 and numbered 25-02/62-37. For the Board’s reasoned decision on the case, please see here (only available in Turkish).
[3] Founded in 2022 by Arnaud Benard, Galileo completed its Series B funding round in October 2024, raising USD 45 million. The round was led by Scale Venture Partners and included participation from notable investors such as Databricks Ventures, Premji Invest, Amex Ventures, Citi Ventures, ServiceNow, and SentinelOne. In addition, existing investors including Battery Ventures, Walden Capital, and Factory continued to support the start-up.
In summary, prior to the acquisition by Google, control over Galileo (although specific shareholding ratios were not publicly disclosed) was held by its founders and investors. Please see: https://aimresearch.co/generative-ai/if-you-dont-solve-this-youre-stuck-in-almost-production-land-galileo-ceo-on-raising-45m-to-fix-ais-biggest-challenge
[4] For further information on the exception for technology undertakings under Turkish merger control regime, please see: https://www.baskaymaz.av.tr/merger-control-in-turkiye-5-technology-undertakings-exception/
[5] Please see: https://digital-markets-act-cases.ec.europa.eu/acquisitions
[6] Please see: https://stitch.withgoogle.com/
[7] Please see: https://developers.googleblog.com/en/stitch-a-new-way-to-design-uis/ https://www.theverge.com/news/670773/google-labs-stitch-ui-coding-design-tool
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