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Google illegally acted to preserve “monopoly power” in the ad-tech business, a federal judge ruled Thursday. It’s the second antitrust case brought by the U.S. government that has gone against the internet giant in the past year.
“For over a decade, Google has tied its publisher ad server and ad exchange together through contractual policies and technological integration, which enabled the company to establish and protect its monopoly power in these two markets,” Judge Leonie Brinkema of the U.S. District Court for the Eastern District of Virginia wrote in the decision (available at this link). “In addition to depriving rivals of the ability to compete, this exclusionary conduct substantially harmed Google’s publisher customers, the competitive process, and, ultimately, consumers of information on the open web.”
The case was brought in January 2023 by the U.S. Justice Department, joined by multiple states, alleging Google engaged in anticompetitive conduct to preserve a “monopolistic grip” on digital advertising.
In her 115-page ruling, which followed a three-week bench trial, Judge Brinkema found that the U.S. government failed to prove there is a relevant market for “open-web display advertiser ad networks” and she dismissed that portion of the complaint alleging Google operates a monopoly there. However, the judge said, the plaintiffs did prove that Google violated Section 2 of the Sherman Act by “willfully acquiring and maintaining monopoly power in the open-web display publisher ad server market and the open-web display ad exchange market” and also “unlawfully tied its publisher ad server (DFP) and ad exchange (AdX) in violation of Sections 1 and 2 of the Sherman Act.”
The judge will next set a briefing schedule and hearing date to determine “the appropriate remedies for these antitrust violations.” The government’s lawsuit, in addition to seeking monetary damages, sought an order requiring Google to divest its publisher ad server and ad exchange products.
In a statement on the ruling, Lee-Anne Mulholland, Google’s VP of regulatory affairs, said, “We won half of this case and we will appeal the other half. The Court found that our advertiser tools and our acquisitions, such as DoubleClick, don’t harm competition. We disagree with the Court’s decision regarding our publisher tools. Publishers have many options and they choose Google because our ad tech tools are simple, affordable and effective.”
When the lawsuit was filed over two years ago, Google said the litigation “attempts to pick winners and losers in the highly competitive advertising technology sector” and that the DOJ “is doubling down on a flawed argument that would slow innovation, raise advertising fees, and make it harder for thousands of small businesses and publishers to grow.”
The ruling comes after a federal judge in August 2024 found that Google held a monopoly in internet search and that the internet giant broke the law by inking multibillion-dollar deals to make its search engine the default on web browsers and smartphones including devices from Apple and Samsung. The judge in case, in the U.S. District Court for the District of Columbia, is scheduled to rule on remedies in the case this spring.
The ruling from Judge Brinkema in the ad-tech monopoly case “is in line with our expectation of a monopoly ruling and breakup recommendation,” BMO Capital Markets analyst Brian Pitz wrote in a note Thursday. Pitz cited Microsoft’s settlement with the U.S. government to resolve the DOJ’s browser-bundling antitrust lawsuit in the early 2000s and said “we expect similar outcomes.” As part of that agreement, Microsoft agreed to share Windows application programming interfaces (APIs) with third parties.
Among the groups weighing in was the National Association of Broadcasters, which applauded the ruling. “Today’s decision affirms what local broadcasters and other publishers have long known: Google has used its dominance in the online advertising marketplace to disadvantage content creators and tilt the playing field,” NAB president and CEO Curtis LeGeyt said in a statement. “As policymakers and regulators consider the implications of this ruling, we urge them to recognize that the same Big Tech dominance harming digital publishers is also undermining the advertising revenue local broadcasters rely on to serve their communities.”
Source: Google Has an Illegal Monopoly in Ad-Tech Markets, Judge Rules
“For over a decade, Google has tied its publisher ad server and ad exchange together through contractual policies and technological integration, which enabled the company to establish and protect its monopoly power in these two markets,” Judge Leonie Brinkema of the U.S. District Court for the Eastern District of Virginia wrote in the decision (available at this link). “In addition to depriving rivals of the ability to compete, this exclusionary conduct substantially harmed Google’s publisher customers, the competitive process, and, ultimately, consumers of information on the open web.”
The case was brought in January 2023 by the U.S. Justice Department, joined by multiple states, alleging Google engaged in anticompetitive conduct to preserve a “monopolistic grip” on digital advertising.
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In her 115-page ruling, which followed a three-week bench trial, Judge Brinkema found that the U.S. government failed to prove there is a relevant market for “open-web display advertiser ad networks” and she dismissed that portion of the complaint alleging Google operates a monopoly there. However, the judge said, the plaintiffs did prove that Google violated Section 2 of the Sherman Act by “willfully acquiring and maintaining monopoly power in the open-web display publisher ad server market and the open-web display ad exchange market” and also “unlawfully tied its publisher ad server (DFP) and ad exchange (AdX) in violation of Sections 1 and 2 of the Sherman Act.”
The judge will next set a briefing schedule and hearing date to determine “the appropriate remedies for these antitrust violations.” The government’s lawsuit, in addition to seeking monetary damages, sought an order requiring Google to divest its publisher ad server and ad exchange products.
In a statement on the ruling, Lee-Anne Mulholland, Google’s VP of regulatory affairs, said, “We won half of this case and we will appeal the other half. The Court found that our advertiser tools and our acquisitions, such as DoubleClick, don’t harm competition. We disagree with the Court’s decision regarding our publisher tools. Publishers have many options and they choose Google because our ad tech tools are simple, affordable and effective.”
When the lawsuit was filed over two years ago, Google said the litigation “attempts to pick winners and losers in the highly competitive advertising technology sector” and that the DOJ “is doubling down on a flawed argument that would slow innovation, raise advertising fees, and make it harder for thousands of small businesses and publishers to grow.”
The ruling comes after a federal judge in August 2024 found that Google held a monopoly in internet search and that the internet giant broke the law by inking multibillion-dollar deals to make its search engine the default on web browsers and smartphones including devices from Apple and Samsung. The judge in case, in the U.S. District Court for the District of Columbia, is scheduled to rule on remedies in the case this spring.
The ruling from Judge Brinkema in the ad-tech monopoly case “is in line with our expectation of a monopoly ruling and breakup recommendation,” BMO Capital Markets analyst Brian Pitz wrote in a note Thursday. Pitz cited Microsoft’s settlement with the U.S. government to resolve the DOJ’s browser-bundling antitrust lawsuit in the early 2000s and said “we expect similar outcomes.” As part of that agreement, Microsoft agreed to share Windows application programming interfaces (APIs) with third parties.
Among the groups weighing in was the National Association of Broadcasters, which applauded the ruling. “Today’s decision affirms what local broadcasters and other publishers have long known: Google has used its dominance in the online advertising marketplace to disadvantage content creators and tilt the playing field,” NAB president and CEO Curtis LeGeyt said in a statement. “As policymakers and regulators consider the implications of this ruling, we urge them to recognize that the same Big Tech dominance harming digital publishers is also undermining the advertising revenue local broadcasters rely on to serve their communities.”
Source: Google Has an Illegal Monopoly in Ad-Tech Markets, Judge Rules