Break-Up Alphabet And Declare Communism?

Forbes

08-05-2025

Google parent company Alphabet's (NASDAQ:GOOG) CEO Sundar Pichai took the stand on April 30th, in court proceedings, to determine this: How should Google parent Alphabet be punished? Yep, how to punish Google!
If we didn't know what Google was, one would think we're talking about destroying an enemy in warfare. Or, maybe America wants to turn into communist China, faster than China aspires to rival American capitalism's success! At our core, we believe in cutting through the noise. While regulators debate how to discipline today's tech leaders, we focus on understanding what actually drives long-term value and apply that principle to our High Quality portfolio, which has outperformed the S&P and clocked >91% returns since inception.
The proponents of Google's break-up have a simple message: Google's parent Alphabet must be broken. It has too much power. Google Search, Android, Chrome, YouTube are each massive, and collectively, it's a scary beast. Certainly a valid lens to see things through. Right?
Let's step back. This is Google. A company created on this soil, started in Silicon Valley, with founders who dropped out of Stanford - supported by longtime tech executives like Sun Microsystems' Andy Bechtolsheim, and VCs like Sequoia, right here in this country. This is an American classic! It's a poster child of the American dream.
This is our company. So why break it up? Why the envy? Why destroy?
Why not think about making it even bigger. More powerful. More celebrated?
80% of people in this country, if offered a job at Google, would be delighted to accept it. Maybe more than 80%. From software engineers, to English and Philosophy majors, marketeers, and even Biochemists, there are opportunities in different corners of what is now the Alphabet empire.
What has Google really built that makes it so attractive? While it's easy to see what are Google's parts, and how you can break it up, it's much harder to fathom the role of cultural ties between these parts - the unspoken work ethics, the balancing of innovation with operational excellence, and perhaps efficient teamwork across seemingly-disparate groups, are probably more valuable than is obvious at first blush.
Isn't there an opportunity to learn from that culture? Build it out, bigger, spread it, rather than stifle? How incredible would it be if instead of just 185K people that Google employs, 10x more, say 2 million people could learn from that culture - be a part of it - grow and develop it to the next level?
It's childish to break what you don't understand. Isn't it fair to say, what you don't know how to build, you don't really understand? Building is hard. It takes imagination, courage, and focus. Laser-like focus, and years of tinkering. Breaking-up takes none of that - you see what's there, and you break it into parts. That's not building.
Creative destruction starts with a hypothesis, a mission - about something way bigger. Current dialog about breaking up, and analysis surrounding it - is just that. Analysis. There is little imagination and creativity, far from a plan that's been proposed to show how we create something 100x or even 10x of what is the current Google. Unless we can come up with a concrete plan, do we deserve to try to break Google?
The solution must be to grow. If Google founders created a company worth $2 trillion from nothing - how can we together grow it to 20 trillion dollars?
Tax them. Sure. Ask them to share a higher percent of profits. Why not? Give Google more responsibility - set a higher cultural and social bar across the board for companies that generate more than $100 billion in net profits annually. Isn't that way more responsible than breaking it up?
Instead of navel-gazing, let's harness Google's culture to solve real problems. Plenty of problems exist: from reliable and cheap access to information, to clean energy, to democracy, and people's rights around the world. In fact, the Google founders saw that - they created Alphabet with the expectation to perhaps use the leverage of an effective culture - a culture that has worked to build diverse businesses from Verily, and Isomorphic, to Waymo, and Wing. The point is - when you bring the best under one umbrella, there is room for magic.
These didn't exist. They take imagination. Demonstrate boldness, and have a shot at magic.
The real enemy is not Google, it's a lack of imagination. Lack of imagination makes you weak, makes you fight. Makes you think breaking-up. If a trillion looks big today, it'll probably look tiny in 10 years - if only we are insolent enough to imagine the outrageous $20 trillion behemoth that Alphabet can be in the next 10 years!
While others argue over breaking up today's winners, we're busy identifying tomorrow's giants. It's that forward-looking imagination and discipline that has helped Trefis High Quality (HQ) Portfolio, which is a collection of 30 stocks, comfortably outperform the S&P 500 over the last 4-year period. What does that mean? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics.