Google will appear before U.S. antitrust prosecutors on Monday, September 9, in Alexandria, Virginia. During this session, the Justice Department will aim to demonstrate that the company has hindered competition in online advertising technology. This marks the search giant’s second recent encounter with the Justice Department.
Prosecutors argue that Google has exerted significant control over the technological framework that supports the dissemination of news and information on websites, processing more than 150,000 online ad sales every second.
This case is crucial for U.S. antitrust regulators seeking to challenge perceived monopolies in Big Tech, a task that has persisted through both the Trump and Biden administrations.
Does Google strategically dominate website advertising tools?
The Justice Department alleges that Google has employed a complex strategy to dominate website advertising tools, which includes acquiring other companies, imposing restrictions on the use of its tools by customers, and manipulating ad auctions.
In response, Google denies these claims, asserting that they misinterpret the company’s legal efforts to develop its technology and support its customers. The company also contends that the prosecutors ignore the fact that the digital advertising market has shifted to apps and connected TV, where Google faces significant competition.
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Should U.S. District Judge Leonie Brinkema determine that Google has violated the law, she would then consider the prosecutors’ request for Google to divest at least Google Ad Manager, a platform encompassing Google’s publisher ad server and ad exchange.
Stock analyst Wedbush has reported that Google’s ad tech tools contributed $20 billion, or 11% of the company’s gross revenue in 2020, and approximately $1 billion, or 2.6%, of operating profit for that year. In 2020, Ad Manager represented 4.1% of revenue and 1.5% of operating profit, according to Wedbush’s research and court documents. Recent figures have been redacted from court records.
Big Tech monopolies under scanner
Karen Dunn, a partner at Paul, Weiss, and a key figure in the debate preparations for several notable Democrats including Vice President Kamala Harris, is leading Google’s defense team.
The government’s legal team is directed by Julia Tarver Wood, an experienced trial lawyer who joined the Justice Department last year. She previously worked at Paul, Weiss, representing clients such as American International Group, Mastercard, and Amazon.com.
The multiweek trial is anticipated to include testimonies from Google and its competitors in the digital advertising industry, such as the Trade Desk and Comcast, as well as publishers like News Corp and Gannett, who prosecutors claim were adversely affected by Google’s actions.
This case is part of a broader series of actions against alleged Big Tech monopolies. Recently, the Justice Department secured a ruling against Google in a separate case concerning its dominance in online search and is also suing Apple. Additionally, the U.S. Federal Trade Commission is pursuing cases against Meta Platforms, the parent company of Facebook, and Amazon.
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