Wednesday, December 18, 2024

Trump’s New Running Mate J.D. Vance Wants To Break Up Google: Could 2024 Election Be Bad For Big Tech? – Alphabet (NASDAQ:GOOG), Alphabet (NASDAQ:GOOGL)

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Donald Trump’s vice-presidential pick, Senator J.D. Vance, adds a former venture capitalist to the GOP ticket for the 2024 presidential election.

It also comes as business leaders in the tech space donate to the former president.

But Vance has favored breaking up large tech companies, namely Google’s parent company, Alphabet Inc GOOGGOOGL.

What Happened: Earlier this year, Vance tweeted: “It’s time to break Google up. This matters far more than any other election integrity issue. The monopolistic control of information in our society resides with an explicitly progressive technology company.”

The post came ahead of Vance’s attending an event for antitrust reform. The event included Federal Trade Commission Chair Lina Khan and Senator Elizabeth Warren (D-Mass), who have been viewed as two figures looking to break up tech companies, as reported by The Verge.

“The fundamental question to me is, how do we build a competitive marketplace that is pro-innovation, pro-competition, that allows consumer to have the right choices and isn’t just so obsessed on pricing power within the market that it sort of ignores all the other things that really matter?” Vance asked the audience.

At the event, Vance praised Khan, a President Joe Biden appointee. Republicans, in contrast, criticize Khan’s blocking of tech deals.

“I look at Lina Khan as one of the few people in the Biden administration that I actually think is doing a pretty good job,” Vance said.

One of the reasons Vance is against big tech centers on the perceived control big-name companies have over what people can say and post online. Vance alleged that voters will see results on Google that could be “explicitly biased towards Democrats” and called this “a threat to democracy.”

At the event, Vance targeted Google and Facebook, a unit of Meta Platforms META.

“I think that Google and Facebook have really distorted our political process. And I think a lot of my friends on the left would agree with me, but they might disagree with me directionally about how to fix that problem,” he said. “We have to stop the craziness, and I think one way to do it is to stop the way that these companies control the flow of information in our country.”

Read Also: Trump Picks Senator J.D. Vance As Running Mate: Musk Says ‘Great Choice’ For VP

Why It’s Important: While Vance has vocally called for Google to be broken up, his appointment as the running mate of Trump doesn’t mean it will happen. Vice presidents don’t specifically set policy and oftentimes don’t have a ton of power.

Having Vance in the White House could lead to more discussion from Trump and Congress on how to break up big technology companies and improve antitrust legislation.

The public callouts against Google come as Vance is an investor in video-sharing platform Rumble Inc RUM, a company that has filed multiple lawsuits against the search engine company.

Lawsuits from Rumble have centered on favoring YouTube in search results and digital advertising practices.

Vance also counts the Invesco QQQ Trust QQQ as one of his largest investments.

The U.S. Justice Department also filed a lawsuit against Google and has circled on the big technology company over antitrust concerns.

For Alphabet investors, the big question is if a breakup of the company could unlock shareholder value and be favored by some.

Needham analyst Laura Martin called Alphabet a top large-cap stock pick for 2024 and has a Buy rating.

Martin said Google is worth more in a sum of the parts than as one company and she welcomes attempts to break up the company.

“We believe the EU will ultimately require GOOGL to spin off its 3rd-party network ad business,” Martin said.

Martin said breaking up Google could add 10% to 15% of upside for shareholders with YouTube potentially worth $455 billion to $634 billion on its own.

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