Could large tech companies be forced to break up?
On Monday, it came out that the Justice Department is launching an investigation into Google related to the company’s search engine practices. Meanwhile, the FTC is reportedly looking into antitrust claims about Facebook and Amazon.
House lawmakers also announced they plan to look into possible anti-competitive behavior. And now, a number of analysts are raising concerns that more large technology companies will be the target of such investigations.
Analysts from Baird and JP Morgan Chase have raised concerns about the effect these investigations will have on tech stock prices as a whole. If these types of investigations continue, they could lead to a total overhaul of antitrust regulations.
Big Tech faces mounting political pressure
This is one of the few issues that both Republicans and Democrats seem to be aligned on, albeit for different reasons. Democrats argue that companies like Facebook and Google are anti-competitive and hurt consumers.
Senator Elizabeth Warren has been leading the charge to break up big tech for a long time. She’s made it a core issue in her presidential campaign. And other Democrats are concerned about consumer privacy issues relating to Facebook.
And President Donald Trump argues that social media platforms promote a “liberal bias” and restrict freedom of speech. He’s also been a long-time critic of Amazon CEO Jeff Bezos.
But according to Baird analyst Colin Sebastian, these arguments are unlikely to hold up. For one thing, companies like Google and Facebook provide free services to consumers.