U.S. D.O.J. Sues Google Over Monopolizing Digital Advertising Technologies

[engine]

The U.S. Department of Justice is suing Google over digital ad market dominance.

This is big news.

Today, the Justice Department, along with the Attorneys General of California, Colorado, Connecticut, New Jersey, New York, Rhode Island, Tennessee, and Virginia, filed a civil antitrust suit against Google for monopolizing multiple digital advertising technology products in violation of Sections 1 and 2 of the Sherman Act.

Filed in the U.S. District Court for the Eastern District of Virginia, the complaint alleges that Google monopolizes key digital advertising technologies, collectively referred to as the “ad tech stack,” that website publishers depend on to sell ads and that advertisers rely on to buy ads and reach potential customers. Website publishers use ad tech tools to generate advertising revenue that supports the creation and maintenance of a vibrant open web, providing the public with unprecedented access to ideas, artistic expression, information, goods, and services. Through this monopolization lawsuit, the Justice Department and state Attorneys General seek to restore competition in these important markets and obtain equitable and monetary relief on behalf of the American public.

[justice.gov...]

Edit: Updated with current story

[not2easy]

There was a DOJ announcement this afternoon so I'm sure there will be more to come with those details. They are attacking the closed and automated ad auctions using tracking details for max targeting from the short bit I saw.

[phranque]

the NYAG's press release includes the products they intend to target.

The components of the ad tech market, and Google’s actions to monopolize each one, include:

The Publisher Ad Server Market: ... Since 2008, Google has owned the industry’s leading publisher ad server, Google Ad Manager (aka DoubleClick for Publishers, or DFP). Google restricts publishers’ power to transact with rival exchanges on their preferred terms.
The Ad Exchange Market: ... Google owns the industry’s leading ad exchange, called AdX, now packaged as part of Google Ad Manager. Google provides advantageous bidding techniques exclusively to AdX, and restricts real-time access to AdX to DFP, as part of Google Ad Manager.
The Advertiser Ad Network Market: ... Google offers the industry’s leading ad network, Google Ads, and makes its demand available only through AdX.

source: Attorney General James Sues Google for Monopolies in Digital Advertising [ag.ny.gov]

[superclown2]

This is likely to paralyse Google for ages, just at the time when all these new threats are emerging. Even if the DOJ loses their case the damage to Google could be massive.

Interesting days ahead - despite all their efforts with 'other bets' these are still a huge drain on the bottom line. Without their advertising monopoly Google could be a basket case - unless they have other plans up their sleeves?

[engine]

You're correct, superclown2 , it'll drag on for ages.

What we don't know is how it'll all end up. Many would like to see the end of Google's monopoly by breaking up the company. That, on its own, would not only be very significant, but it'll also mean that other services we see as free will become fee-based.

[Sgt_Kickaxe]

Wow, the DoJ is on the ball, suing for something they say has been going on for 15 years!

My opinion: 10 years ago this would have been a big deal. Today, with the current politicized state of the DoJ, and by simply looking at who is leading the investigation(and checking their recent work).... this is for show. Something will change, but the stated goal is likely not the end goal, time will tell.

As alleged in the complaint, over the past 15 years, Google has engaged in a course of anticompetitive and exclusionary conduct that consisted of neutralizing or eliminating ad tech competitors through acquisitions; wielding its dominance across digital advertising markets to force more publishers and advertisers to use its products; and thwarting the ability to use competing products.

'weilding', 'neutralizing' and 'thwarting' sound ominous, but are in fact legal. All businesses compete and I don't think Google is even being accused of blocking a user from using another service. The litmus test is did they stop users from using competing products? I don't see that threshold being passed.

Attacking things just because we don't like them isn't justice, or law. I'm not a Google fan anymore, haven't been for a long time, but the application of law in this country is getting strange and Google is probably scratching their legal heads, at best.

I bet Google is wondering what in the heck is going on, lol. NY just put an 8 foot demonic looking statue of a woman with horns wearing a lace collar on top of the Manhattan courthouse too... and Google employees are threatening to sue Google to force them to provide 'psychological safety' after firing 12,000 employees and making the rest 'worry'.

ANYWAY, the problem with firing off legal accusations like this is that after they make a big splash they sink due to lack of legal footing, and the perceived fight continues.

Prediction: Google wins this fairly easily. The other case however, they'll probably lose - [webmasterworld.com...]

[superclown2]

it'll also mean that other services we see as free will become fee-based.

Sure, but if they do become fee based, usage will probably drop off a cliff.

Perhaps Google could go back to it's roots and become a search engine again :-)?

[superclown2]

I don't think Google is even being accused of blocking a user from using another service

Sorry but I disagree here. Every major browser (apart from Edge, and Bing is a mess) is paid by Google to have them as default search engine (or in the case of Chrome it is actually owned by them). Android is packed with Google apps. Even Apple products have them as default.

I'm sure that if DDG was in that position we'd all soon be ducking rather than googling.

Theoretically users could change to other search engines but how many could be bothered or don't know how to? To me that's a monopolistic practice, but then I don't run the DOJ.

[Ralph_Slate]

I would suggest that to understand the power that Google holds, read this piece written by Dina Srinivasan, who seems very knowledgeable about the entire ad ecosystem.

[law.stanford.edu...]

All of Google's business is intertwined in a way that benefits Google. A policy on search can be designed to influence publisher behavior in such a way that it benefits Google's ad business - for example, their focus on speed might force publishers to use Google's exchange instead of a third-party exchange, because Google's timing in Chrome shows slightly quicker response for Google exchange.

How does Google draw those "pass/fail" lines at the correct millisecond level? It would be trivially easy for them to draw them so that sites using third-party exchanges fail, and sites using Google's exchange pass.

They're very clearly using their dominance to dominate further.

[Sgt_Kickaxe]

Sorry but I disagree here. Every major browser (apart from Edge, and Bing is a mess) is paid by Google to have them as default search engine (or in the case of Chrome it is actually owned by them). superclown2

It's a valid disagreement, one for the judges, but if you look at it strictly from a legal standpoint, suggesting this is illegal, is not an easy argument to make. Google doesn't force those engines to take the deal, they don't block other companies from making a better deal, etc.

I didn't see any mention of this mentioned in the briefs. As I said, and I'm NOT a lawyer, this suit is odd in its claims. It's more like a "we're suing you, we'll find out why later" type of suit. Long, drawn out, no reason to settle, little chance for success without better legal footing (IMO).

Try telling someone verbally what's happening - "Google is being sued because they paid to be the search engine on a browser, which is legal"... and, they'll raise an eyebrow too.

I would suggest that to understand the power that Google holds, read this piece written by Dina Srinivasan, who seems very knowledgeable about the entire ad ecosystem. Ralph_Slate

Great writeup, but as much as anyone hates Google, it's legal.

I'm not defending Google, I particularly hate that, for a search company, they take ALL of EVERYONE's data they can figure out how to take.

GOOGLE DOES NOT DO ANYTHING UNLESS IT COLLECTS USER DATA. Prove me wrong. I'd have rather seen the suit be about how that data is used, whom its sold to etc.... if the DoJ were going to swing for the fences they could have made it about the end user a little more, not just companies.

"We're going after Google for the people" while only trying to level the playing field for companies. It gets old.

[tangor]

Mixing two legal concepts in one lawsuit can be tricky. Competition v monopoly (what is being sued) and adding PPI (personally protected information) would highly complicate any proceedings.

Two separate things.

[superclown2]

I predict that lawyers will get rich, Google will pay out a fortune in lobbying, the DOJ will harass Google to distraction, there will be multiple appeals and the whole thing will drag on through different changes of government. Even Nostradamus would have a problem predicting the final outcome.

However; does all this really matter? The USA is not the only vitally important market for Google. Already India has whacked Android, causing untold mountains of work for Google to do to comply with the new regulations, and a possibly huge hit to their profitability; and in 2024 the full force of the EU Digital Marketing Act will make most of what's being argued about illegal throughout Europe. I reckon that if Google's advertising monopoly is finally destroyed it will be in courts other than those in America.

Add a labour force now worried about their long term and highly paid futures (not to mention innumerable legal challenges worldwide) and it's no wonder Sergey and Larry are back in harness. Will they decide that Pichai has over-cooked the Google Goose I wonder?

[Sgt_Kickaxe]

I predict that lawyers will get rich, Google will pay out a fortune in lobbying, the DOJ will harass Google to distraction, there will be multiple appeals and the whole thing will drag on through different changes of government. Even Nostradamus would have a problem predicting the final outcome.

Who will get rich? Some seem to have predicted just fine. [yahoo.com...]

Such a complicated web. This case has started in the worst light possible, which is already threatening to derail it.

[tangor]

It took the US gov near 12 years to break apart Bell Telephone ... might take that long for G to be divided into different divisions. Not sure there's that much popcorn out there to watch this movie. :)

[superclown2]

Mr. Pelosi sold off 30,000 shares of Google stock last month, just weeks before the Justice Department filed a lawsuit against the company over alleged antitrust violations.

Doesn't that smell of insider trading? It's illegal here in the UK but isn't it the same in the USA?

I look forward to 'Google - The Movie'. It will be a smash hit.

[Sgt_Kickaxe]

Doesn't that smell of insider trading? It's illegal here in the UK but isn't it the same in the USA?

Oh, it's the same, but the law is not being applied equally to all anymore. Just call it politics and walk away.

So is this a political case? What's the end goal? If you were going to take down Google, this isn't how. I was going to keep an eye on this case, but that was just one of the side shows rolling out at the same time. So.... it's going to turn into a never ending media case more than a legal one, IMO.

The political teeth are into Google more than the legal ones right now.

[superclown2]

It took the US gov near 12 years to break apart Bell Telephone ... might take that long for G to be divided into different divisions.

Absolutely right. However it didn't take anything like that for Microsoft to be knocked off their perch, by distracting them so much that an upstart called Google was able to move into their space. Imagine trying to run, let alone expand, your business with a government agency watching your every move and waiting for a chance to pounce.

Right now Google is threatened on many fronts, not least of all of losing their ability to dominate the vital mobile market. Seizing it in the first place was a brilliant piece of strategy on their part but the decision by India's supreme court has holed it under the water. In the meanwhile Google seems to have gone into panic mode over the threat of ChatGPT and is concentrating on it as a major threat.

I accept that mine is a minority view; but I don't see it that way. This new chatbot (and there are more on the way) costs a fortune to run. At the moment it is free to use (if you can get on it) but I have seen a proposed cost of $42 a month (yes, per month, not per year) for future use. The overwhelming majority of people that currently use Google either won't be able, or won't want, to pay out that sort of money.

Google's response? Why, have their own, of course. However, leaving aside the question of whether or not users would prefer it over their ultra popular rival, it is questionable whether it should even partly replace their currently very successful business plan of filling SERPs with ads.

Google is looking increasingly like a company that squelches under pressure, and that pressure will only get worse. Yes the DOJ investigation may well take until Doomsday to bring Google to heel but in the meanwhile it could cause them immense damage.

[tangor]

G's problem is they are VIEWED by many as MONOPOLY---and in the ad services field they are---and monopoly is a condition that generally requires government to get involved. Since G is US based it will be the US gov that will have the greatest effect and final disposition, including what EU and India are already involved with, which are NOT SPECIFICALLY the ad "monopoly", but other aspects and privacy and (ahem) taxation and fees.

[Sgt_Kickaxe]

G's problem is they are VIEWED by many as MONOPOLY---and in the ad services field they are---and monopoly is a condition that generally requires government to get involved.

Except the suit claims this has been going on for 15 years, so if that's true, gov waited 15 years too long. It shouldn't be about perception. Taxpayers are funding this suit, possibly for a very long time.

It's turning into a media sideshow already.

[tangor]

G has been under investigation for 15 years ... but this suit just started a few days ago, and the premise is different from previous investigations. This one might have teeth, as well as a government that has seen the "usefulness" of g ebb and flow over the last three election cycles. G's lobbyists pleas might fall on deaf ears this time around.

[Sgt_Kickaxe]

G's lobbyists pleas might fall on deaf ears this time around.

- Not in these amounts, unless more money closes them.
- We live in a time when the only secure document in DC is the Epstein client list, lol.

Anything is possible. It's already too far outside the halls of justice for me to have any faith what I'm seeing is real, that's all. Media is saying all kinds of things, but a judge has said very little, wait for the judge to speak.

If the DoJ wins, and Google pays a huge price, will any of the money go to the businesses Google supposedly harmed? HA! Not likely.

We'll see, literally. It should be a good show. Hopefully, you don't have to tune in another 15 years from now.

[superclown2]

but a judge has said very little, wait for the judge to speak.

I understand that the DOJ has opted for a jury trial. 'Lobbying' doesn't affect juries the same since you don't know who they will be until the trial begins.