Key Takeaways
- The Justice Department has submitted a filing giving a federal court a framework for reshaping Alphabet's Google, including breaking up the tech giant for an illegal monopoly over search.
- In its response to the filing, Google said the DOJ's "radical and sweeping" measures could hurt U.S. innovation and consumers. J.P. Morgan noted the "expanded reach" of Justice Department.
- The DOJ said it will file a more "refined" final framework in November.
The U.S. Department of Justice (DOJ) has submitted a filing giving a federal court a framework for restructuring Alphabet's (GOOGL) Google, including breaking up the tech giant for an illegal monopoly over search.
The 32-page filing said the government is considering a "full range of tools" that include "structural" remedies to improve competition. It said in the filing late Tuesday that it is also considering "behavioral and structural remedies that would prevent Google from using products such as Chrome, Play, and Android to advantage Google search and Google search-related products."
Alphabet shares, wಞhich have gained almost 18% this year, fell 1.1% Wednesday morning.
Google Says DOJ's Proposals are 'Radical' and 'Sweeping'
Google's vice president of regulatory affairs, Lee-Anne Mulholland, said the DOJ's "radical" and "sweeping" proposals could have "significant unintended consequences for consumers, businesses, and American competitiveness."
"We are concerned the DOJ is already signaling requests that go far beyond the specific legal issues in this case," Mulholland wrote.
The filing follows U.S. District Judge Amit Mehta's 澳洲幸运5官方开奖结果体彩网:ruling in August in favor of the DOJ's suit, 澳洲幸运5官方开奖结果体彩网:first filed in 2020. The judge ruled that Google had violated the 澳洲幸运5官方开奖结果体彩网:Sherman Act by ꦿmonopolizing both search and text ads v🌱ia exclusive distribution agreements in the U.S.
The DOJ said that it will file a more "refined" final framework in November.
J.P. Morgan Calls Out 'Expanded Reach' of Justice Department
JPMorgan analysts called the filing's framework "somewhat broad and unspecific in terms of exact remedies" and said it showed the Justice Departmetn's "expanded reach".
“Overall, we do 𝕴not believe the high-level framework changes much for Google shares near-term, & Street focus will shift to earniꦰngs over the next few weeks and then to final proposed DOJ remedies on November 20,” the broker said in a note Wednesday.
UPDATE: This story has been updated to add the J.P. Morgan view and to reflect fresh share-price movement.