In a note released this Thursday (July 10), Bank of America analysts say that anti-monopoly measures could benefit Alphabet
BofA (Bank of America) identified positive factors in the potential division of Google by Alphabet, the company’s parent company. The analysis, released this Thursday (October 10, 2024), addresses the measures proposed by the DOJ (United States Department of Justice) against the technology giant, which faces accusations of monopoly in search services.
Among the actions suggested by the DOJ are the termination of exclusive agreements with companies such as Apple and Samsung, restrictions on data tracking, mandatory information sharing and the possibility of divestment in assets such as Chrome and Android. These measures aim to promote fairer competition in the sector.
Although these proposals are considered harsh, BofA emphasizes that the legal process represents only the beginning of a long legal battle, with a final verdict expected only in the first half of 2025. Alphabet expressed concerns about the demands, stating that they arise in a time of increasing competition in the sector, driven by innovations in artificial intelligence.
The bank also highlights that Google maintains a solid position in the search market, suggesting that users tend to prefer the platform regardless of exclusive agreements. The situation is reminiscent of the Microsoft case, in which an initial recommendation for a break-up was reversed in favor of an agreement.
BofA anticipates that Alphabet’s counterproposals, expected in December, could result in a more favorable outcome for the company. Alphabet currently trades at a discount to its potential value in the event of a breakup, and with minimal layoffs compared to its competitors, there is room for growth in earnings per share under the new financial direction.
With information from Investing Brazil.
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