Google has multiple monopolies in ad-tech, federal judge rules

Do not pass “Go,” do not collect $200: Google operates a monopoly in multiple digital advertising markets, a federal judge ruled yesterday. It marks the second antitrust case to go against the tech giant in less than a year, and could result in a breakup of part of its business.

Your honor, we sell ads

The DOJ’s case against Google focused on its alleged monopoly over three parts of the ad-tech market: the publisher ad server market, ad exchange market, and tools used for general display advertising. Think—the programs that determine which ads you see on certain websites (recipe pages, news sites, statistical archives, etc.).

• In her 115-page opinion, the judge ruled Google unlawfully controls two of those markets: the publisher ad server market and ad exchange market, saying the company ties its products together in a way that effectively forces publishers (websites that place ads on their sites) that use the company’s tools to manage ad space to also use their products to facilitate transactions with advertisers.
• However—the judge tossed out the third part of the case (tools for general display ads), ruling it couldn’t be defined as Google’s own market. She particularly cited the purchases of DoubleClick ($3.1 billion in 2008) and AdMeld ($400 million in 2011), saying the government failed to show those “acquisitions were anticompetitive.”

Next steps: The DOJ is arguing that Google should be forced to divest its ads products to ensure publishers aren’t locked into paying higher fees because they can’t afford to drop them. Google, which in 2023 generated $31 billion in revenue from these products, or 1/10 of its parent company Alphabet’s overall revenue, has said it will appeal the ruling.

Two-timing: In its other antitrust trial, a federal judge ruled in August that Google had a monopoly in online search. A three-week remedies trial in this case is scheduled to begin Monday, with the DOJ pushing for Google to be forced to divest its Chrome browser, among other things.

It’s not the only tech giant on the hot seat. Meta CEO Mark Zuckerberg and former COO Sheryl Sandberg both gave multiple days of testimony this week in an antitrust trial regarding the social giant’s acquisitions of Instagram and WhatsApp. An FTC case against Amazon is also set to go to trial in September. And Apple is facing an antitrust case over allegations it locks users into its ecosystem by impeding the ability of outside software to integrate with its devices.

Looking ahead…With appeals, these cases👆 could each take years to play out.

📊 Flash poll: In general, do you support stronger or weaker antitrust enforcement against Big Tech?

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