Google's Breakup Could Have Massive Ramifications For Big Tech (Thanks, DOJ)...

Welp, it’s official, Google’s hole just keeps getting deeper and deeper. When the Department of Justice punched Sundar Pichai, turning his glasses into contacts, the news of potential revenue losses were the peak of Googles worries. 

(Source: Giphy)

However, now, the DoJ is playing a game of “eeny, meeny, miny, moe” with Google’s business unit. Including a potential forced agreement for Google to share its data with competitors or abandon exclusive agreements (sorry, Apple). Translation: Google might indeed be royally screwed from here on out. 

(Source: Bloomberg) 

Again, this isn’t just a slap on the wrist; it’s more like a full-on intervention. The proposals, according to Judge Amit P. Mehta of the U.S. District Court (the man responsible for slamming the gavel on Google), suggested some drastic measures to cut Google down to size. Think, Standard Oil and AT&T’s Bell breakup. Now nothing is set and stone yet, but the final verdict is set to take place by September 4th. 

(Source: New York Times) 

This had Wall Street, justifyingly being the drama queen that it is, immediately having a meltdown as Google tanked -2.63% upon the news. Which on the surface doesn’t seem like much, but for a company that’s been printing money faster than Elon tweets, it definitely stings. But it makes sense right? This is the panic reflection over what a Google breakup could mean for the $2 trillion tech titan, which raked in $175 billion last year just by showing us ads for things we didn’t even know we needed.

(Source: Barrons) 

However, if Google gets sliced and diced, the consequences for consumers could be as mixed as a bag of Halloween candy. On one hand, competition might finally get a chance to breathe (“Even Bing may have a chance” - said no one ever), leading to more ideas on search features, and better user experiences -  like not getting pummeled by products you forgot you searched for while drunk. 

(Source: Bored Panda)

On the other hand, a Google breakup might lead to a rollercoaster of service quality in what we have deemed normal in the search world. For instance, a separation of powers into smaller independent companies may dilute the resources or expertise to maintain the higher standards the company, as a whole, has set for so long. Meaning if these services become less reliable, finding relevant information could become more of a pain in the a$$ than it already is. See: Similar situation as “bring back the mean tweets!”… iykyk)

(Source: Teeruto) 

So with that said, while the Justice Departments weighs its next steps, Google is no doubt sweating more than a hooker in church. The discussions and decisions made in the coming weeks will not only determine Google’s fate but also signal a shift in how regulators approach other monopolistic practices in the tech world - especially considering Meta is getting hammered in the EU for conjoining Facebook Marketplace with its advertising presence. 

(Source: CNBC) 

So as we await whether Google will have as dramatic a breakup as the Beatles or they’ll come out unscathed (likely not), the tech world is 100% holding its breath on this one. Because again, in the grand scheme of things, this is about more than just one company - it’s setting a precedent for how governments will handle tech giants that have become modern-day behemoths from this point forward. 

Now only time will tell how disruptive things will get from here, especially in Big Tech, but for Google's sake, keep an eye on the stock. Shorts are no doubt circling the waters, but if Google manages to pull a Houdini, well there’s no telling how big of a rally it could ignite.

(Source: Giphy) 

At the time of this writing Google is down -3.23% on the day (up 15.07% YTD) 

Stocks.News holds positions in Google, Meta, and Apple as mentioned in the article.