Biden's War Against Monopolies: Justified or Excessive?

For the first time in history, 43% of S&P500 companies are under investigation for antitrust

On 09/12/2023, the lawsuit between the US Department of Justice and Google officially began, after 3 years of pre-trial procedures. The focus of the lawsuit is the accusation that Google holds a monopoly in the online search sector and related advertising markets.

Search is the main business activity, accounting for 57% of Google's total revenue in 2023, equivalent to 175 billion USD. Search is also the key segment driving Alphabet's market capitalization to over 2.12 trillion USD.

This is the largest antitrust lawsuit since the Microsoft case in 1998, marking a major shock for Big Tech. Although remedies have not yet been announced, the consequences of the lawsuit could change how Google operates and have a profound impact on the technology industry. The search market and consumer choices could be completely reshaped.

The protracted lawsuit makes Google currently the cheapest large-cap stock with a forward P/E near 20. The main reason is investors' concerns that the court may order Google to be split into independent subsidiaries.

This article consists of 6 parts:

1. Overview of Antitrust Regulations in the United States

2. The antitrust battle between the US and Google

3. Possible sanctions

4. Other case studies: JetBlue and Spirit; Tapestry and Capri

5. Lina Khan - Biden's Antitrust Icon

6. Two-sided perspective: Impact of antitrust lawsuits