Google Faces DOJ’s Second Antitrust Trial Over Alleged Ad Tech Monopoly

The U.S. Department of Justice (DOJ) told a federal judge that Alphabet’s Google illegally dominated online advertising (ad) technology in seeking a second antitrust trial with a win against the company. Google is already facing a possible breakup of the company over its ubiquitous search engine. Now Google is fighting to beat back another attack by the U.S. DOJ alleging monopolistic conduct, this time over technology that puts online ad in front of consumers.

The Justice Department and Google made closing arguments Monday in a trial alleging Google’s advertising technology constitutes an illegal monopoly. The closing arguments in Alexandria, Virginia, cap a 15-day trial held in September where prosecutors sought to show Google monopolized markets for publisher ad servers and advertiser ad networks, and tried to dominate the market for ad exchanges which sit between buyers and sellers.

Google ad monopoly case decision

District Judge Leonie Brinkema in Alexandria, Virginia, will decide the Google antitrust trial and is expected to issue a written ruling by the end of the year. If Brinkema finds that Google broke the law, she would consider prosecutors’ request to make Google at least sell off Google Ad Manager, a platform that includes the company’s publisher ad server and its ad exchange.Also Brinkema finds Google has engaged in illegal, monopolistic conduct, she will then hold further hearings to explore what remedies should be imposed.

Google antitrust trial

As per DOJ lawyer Aaron Teitelbaum “Google rigged the rules of the road,”. During the Google antitrust ad trial, he asked the judge to hold Google accountable for anticompetitive conduct and added Google is “once, twice, three times a monopolist.”

Another DOJ lawyer Julia Tarver Wood compared the Google ad monopoly case to the Charles Dickens novel “A Tale of Two Cities”. She said U.S. Judge Leonie Brinkema had to decide whether to adopt the DOJ or Google version of the state of the online ad market.

Google on ad dominance

Google lawyer Karen Dunn said DOJ had not met its legal burden and was asking Brinkema to disregard antitrust and overrule key precedents. “The law simply does not support what the plaintiffs are arguing in this case,” Dunn said.

She argued DOJ was ignoring Google’s legitimate business decisions and that the online advertising market was robust. The company argues the government had cherrypicked a narrow slice of the online ad market and did not account for aggressive competition.

Google’s ad network

Publishers testified at trial that they could not switch away from Google, even when it rolled out features they disliked, since there was no other way to access the huge advertising demand within Google’s ad network.

News Corp in 2017 estimated losing at least $9 million in ad revenue that year if it had switched away, one witness said.

Google offered to sell the ad exchange this year to end an EU antitrust investigation but European publishers rejected the proposal as insufficient, as reported.

What DOJ wants?

The Justice Department, along with a coalition of states, has already said it believes Google should be forced to sell off parts of its ad tech business, which generates tens of billions of dollars annually for the Mountain View, California-based company.

After roughly a month of trial testimony earlier this year, the arguments in the case remain the same.

During three hours of arguments Monday, Brinkema, who sometimes tips her hand during legal arguments, did little to indicate how she might rule. She did, though, question the applicability of a key antitrust case Google cites in its defense.

Google ad dominance

The Justice Department contends Google built and maintained a monopoly in “open-web display advertising,” essentially the rectangular ads that appear on the top and right-hand side of the page when one browses websites.

Google dominates all facets of the market. A technology called DoubleClick is used pervasively by news sites and other online publishers, while Google Ads maintains a cache of advertisers large and small looking to place their ads on the right webpage in front of the right consumer.

In between is another Google product, AdExchange, that conducts nearly instantaneous auctions matching advertisers to publishers.

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