YWR: The Google bomb no one is talking about.

On January 23rd, 2023 the Department of Justice filed an antitrust suit against Google in the Eastern District of Virginia. The case claims Google has built an uncompetitive monopoly in the website advertising business, a business that generated $31bn of revenues for Google in 2021. The DOJ requests that Google’s website publishing business, at the very least, needs to be separated from Google and Google needs to refrain from uncompetitive behaviour.

The market reaction to this massive news? Zzzzz…..Down 4% over 2 days. Then by February 2nd, Google recovered everything and was trading at $107. That same day Google released Q4 2022 earnings. So on that earnings call how many questions do you think the sell side analysts ask about a ground breaking DOJ antitrust suit filed just 9 days earlier? Guess. Zero!

DOJ Antitrust suit? Nope. All the questions are about AI and how Google is going to ‘capture all the opportunities in front of them…’. Nothing about the fire the DOJ just lit in the living room.

Eric Sheridan (Goldman Sachs): Thank you so much. Maybe two, if I could. Sundar, for you, continuing on the AI theme, how do you think philosophically about capturing the opportunity set that you see in front of you, given all the investments you've made over the last 5+ years that we've been talking about –

No matter how much the sell side and Google don’t want to talk about this case it is a very big deal and the biggest anti-trust suit since AT&T. So, if they won’t talk about it. I will.