On Tuesday local time, the U.S. Department of justice and state attorney general of 11 states filed an antitrust lawsuit against Google, accusing the technology giant of suppressing competition and illegally maintaining its monopoly position in the Internet search and search advertising market. The lawsuit will be the largest antitrust case in the history of the United States.
In response to the above news, Google's parent company alphabet shares rose instead of falling. Alphabet shares rose $21.32, or 1.39%, to $1555.93 on the Nasdaq Stock Exchange. Alphabet shares rose $19.07, or 1.23%, to 1575.00 in after hours trading.
The U.S. government's antitrust lawsuit is undoubtedly a major blow to Google, but why is the share price of its parent company not affected?
First of all, for investors, this is expected. Many media have previously reported that Google's search monopoly will be the focus of the U.S. Department of justice, and some Wall Street analysts have done a lot of analysis and Research on this.
Finally, Google pays billions of dollars a year to partners such as apple to ensure that its search engine is set by default. The Department's lawsuit alleges that users rarely change default settings, effectively killing competitors' search engines. But analysts say that because of the market influence of Google's search engine, users may eventually choose Google even if they have more choices.
Some critics have been calling for a spin off of Google, separating the search engine from other Google services, such as youtube, maps, advertising technology, Chrome browser and Android operating system.
In addition to the lawsuits filed by the Justice Department and the 11 state attorneys general on Tuesday, some state attorneys general are planning to take further antitrust actions against Google, including lawsuits against the company's behavior in the digital advertising market. In this market, Google controls most of the technology used by advertisers and publishers to buy and sell display ads. In addition, states such as Colorado and Iowa are investigating Google's search market behavior, which will be concluded in the next few weeks. (Tianmen Mountain)