As Google (NASDAQ: GOOGL) faces increasing scrutiny from the U.S. Department of Justice (DOJ) in an ongoing antitrust trial, analysts are discussing the implications of a potential company breakup.
This week, analysts from JPMorgan and Bernstein shared their thoughts on the DOJ’s initial remedy proposal, filed on October 8. The framework focuses on four main areas: search distribution, data handling, artificial intelligence (AI), and advertising strategies.
JPMorgan’s analysts noted that the proposal was largely expected, but warned it could lead to negative public perceptions and “headline risks.” They highlighted that the DOJ might seek structural changes to Google’s key operations, such as Chrome, Play Store, and Android. This could have a profound impact on the company’s long-term stability.
Additionally, potential measures like banning default search agreements and increasing access to Google’s API and ranking data could disrupt its existing business model, JPMorgan added. While they see the chance of structural changes or even possible separation, they don’t believe it will significantly impact Google’s stock performance in the short term.
Bernstein analysts offered a similar viewpoint, describing the DOJ’s proposals as “broad yet lacking in detail.” They pointed out that the real impact won’t be known until the DOJ finalizes its list of remedies, expected by November 20. The Bernstein team also flagged concerns over Google’s AI strategy, which could be constrained by proposed restrictions.
“The last thing Google needs is to be held back in the AI race due to regulatory constraints,” said Bernstein analysts.
Both firms agree that the real challenge for Google lies in how the DOJ shapes the final remedy framework. With Google’s management voicing strong opposition, the outcome remains uncertain, potentially leading to major shifts in the tech giant’s business landscape.
