Google Fights to Block Ad Tech Breakup as U.S. Antitrust Trial Opens
By Jody Godoy
Google, part of Alphabet, is trying to avoid being forced to sell part of its online advertising business as it faces off once again with U.S. antitrust regulators. The trial began Monday in Alexandria, Virginia.
This case represents the government’s latest attempt to curb what a judge has already called Google’s monopoly power, following a recent setback when another court rejected a push to make the company divest its Chrome browser. Online publishers and rival ad tech firms—some of which have separately sued Google—are closely watching the proceedings.
The Justice Department and a coalition of states are asking the court to order Google to sell its ad exchange, AdX. Publishers currently pay Google a 20% fee to sell ads on AdX through instant auctions that occur when users load websites. Regulators also want Google to make the auction’s decision-making mechanism open source.
In her opening remarks, Julia Tarver Wood from the DOJ’s antitrust division said forcing Google to sell AdX is essential to restoring competition, after U.S. District Judge Leonie Brinkema ruled that Google illegally tied AdX to its publisher ad server—a tool that websites use to store and manage digital ad space. “Leaving Google with both the motive and the ability to recreate that tie is too great a risk,” Wood said.
Judge Brinkema is overseeing the trial to decide what remedies to impose, after finding Google unlawfully monopolized web advertising technology.
Google’s lawyer, Karen Dunn, countered that the DOJ’s proposals are “radical and reckless,” arguing that they would damage competition by removing Google from the market. “The DOJ would be giving itself broad, unprecedented power over a major U.S. technology platform,” she said.
Google has urged the judge to take a cautious approach similar to another case in Washington, D.C., where a court rejected most of the DOJ’s proposals regarding the company’s dominance in online search. But Wood argued that case was entirely different, since Chrome was just a distribution channel, not part of the monopoly itself, unlike Google’s ad tech business.
The lawsuits against Google are part of a broader bipartisan crackdown on Big Tech that began under former President Donald Trump and also includes ongoing cases against Meta, Amazon, and Apple.
Google contends the DOJ’s plan is technically unworkable and would cause long-term uncertainty for advertisers and publishers. The company had previously offered to sell AdX in negotiations to resolve an EU antitrust investigation, Reuters reported last year. Those internal studies may surface as evidence in this trial.
Instead of divesting AdX, Google has proposed policy changes to make it easier for publishers to use competing platforms. The DOJ says that is not enough to restore competition.
On Monday, Grant Whitmore, an executive at Advance Local, which runs local news outlets in eight states, testified that Google’s ownership of advertiser tools, publisher tools, and AdX “gives the company plenty of ways to tilt the scales in its favor.” He added that Google should also be required to sell its publisher ad server, not just AdX, to truly level the playing field.
Source: Investing.com