Investing.com -- As Google (NASDAQ:GOOGL) faces the U.S. Department of Justice's (DOJ) antitrust scrutiny, the possibility of a breakup has sparked debate.
In notes this week, analysts from JPMorgan (NYSE:JPM) and Bernstein weighed in on the DOJ's initial remedy framework, which was filed on October 8 in the Google Search trial.
While the framework was broad, it focused on four key areas: search distribution, data use, AI, and advertising monetization.
JPMorgan analysts noted that the framework was "mostly as expected" but warned that it could carry headline risks.
They said the DOJ may push for structural changes in Google's core businesses, such as Chrome, Play, and Android, which could negatively impact the company.
Specific remedies like prohibiting default search deals and opening up Google's API and ranking signals could also affect the tech giant's business model, according to the bank.
JPMorgan sees the potential for structural changes or even separation proposals, though they believe the framework doesn't drastically alter Google's stock outlook in the near term.
Bernstein analysts offered a similar assessment, describing the DOJ's proposals as "a mile wide and an inch deep."
They pointed out that while the remedies are broad, the specifics are light, and the final list of remedies won't be known until November 20.
Bernstein also emphasized the potential negative impact on Google's AI strategy.
The DOJ mentioned AI-related remedies across multiple areas, which could hamper Google's ability to compete in the rapidly growing AI space.
"The last thing Google needs right now in the broader AI battle is having to fight with one hand tied behind their backs by regulators," said Bernstein.
Both firms agree that the real test for Google lies in the details of the DOJ's final proposed remedies. While Google's response has been critical, the situation remains fluid, with the potential for significant long-term changes to the company's business model.