Is it for real this time? The US Department of Justice considers breaking up Alphabet

Google's preliminary remedies for the antitrust case have been proposed, with the divestiture plan still under consideration.

According to Bloomberg's report today, the U.S. Department of Justice submitted a proposal on the same day, indicating that the agency is considering requiring Google to sell off some businesses to weaken the harm caused by its monopoly in the online search market.

The document states:

"Actions and structural remedies are being considered to prevent Google from using products such as Chrome browser, Play, and Android to allow Google Search and related products and features (including emerging search access points and features such as AI) to surpass competitors or new entrants."

The document also mentions that the presiding judge of the antitrust case, Amit Mehta, may also compel Google to open up access to the underlying data for building search results and AI products.

Furthermore, in this 32-page document, the Department of Justice includes the following "remedies" under consideration:

Restricting Google from investing in (potential) competitors in the search engine market;

Requiring Google to allow websites to choose whether to use its AI products;

Requiring Google to provide more information to advertisers and control the placement of ads.

It is reported that the Department of Justice will provide a more comprehensive proposal for remedies next month. Once the Google divestiture plan is implemented, it will be the largest corporate breakup event in the United States in forty years.

Difficulty in implementing the divestiture, Google's stock price may still have room to rise

The U.S. government seems to want to demonstrate its determination against monopolies through the Google case.

On August 5th this year, the U.S. District Court for the District of Columbia ruled that Google illegally monopolized the online search market, violating U.S. antitrust laws. Mehta plans to hold a trial next spring on the proposed remedies and issue a final decision by August 2025.

Last month, Jonathan Kanter, head of the Department of Justice's antitrust division, also stated that early divestiture measures are necessary to end and repair the harm caused by long-term monopolies.

Google, on the other hand, has already stated its plans to appeal Mehta's decision.

However, from a practical perspective, splitting up Google still poses certain difficulties.

Erik Hovenkamp, a law professor at Cornell University, stated:

"From a practical standpoint, splitting up Google is incredibly difficult... Judges view divestitures as an extreme remedy that could have unpredictable consequences. For example, the new company after the split could be eliminated by the market."

With Google suffering a major setback in the antitrust case, is there still buying value in its stock?

Some analysts point out that over the past 19 months, Wall Street has set an average target price of $201.64 for Google, indicating a 21.7% upside potential compared to the current price.

Since the beginning of this year, Alphabet, Google's parent company, has seen its stock price rise by over 18%.