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The Department of Justice (DOJ) launched its latest antitrust trial against Google on Monday, alleging that the tech giant’s dominance in online advertising stifles competition and inflates publishers’ costs. The trial, expected to last several weeks, began in a federal court in Alexandria, Virginia.
The DOJ accused Google of monopolizing the ad tech market by controlling the tools that connect advertisers with publishers. “Google is not here because they are big; they are here because they used that size to crush competition,” said DOJ attorney Julia Tarver Wood in her opening statement.
Google’s defense, led by attorney Karen Dunn, argued that its success stems from its superior products and competitive practices. Dunn asserted that Google competes “millisecond by millisecond” for every ad impression against other companies.
The Core of the Allegations
Prosecutors claim Google uses its dominant position to control over 150,000 ad sales every second, taking a significant cut from each transaction. The DOJ outlines that Google’s share can be up to 37 cents of every advertising dollar. They argue this control inflates costs for publishers and limits options for advertisers.
Tim Wolfe, an advertising executive at Gannett, testifies that his company has relied on Google’s publisher ad server for 13 years due to a lack of viable alternatives. Other industry players, who find switching ad servers technically challenging and costly, echo this sentiment.
Google counters that it faces robust competition from other tech companies like Amazon and Comcast, especially as digital ad spending shifts towards apps and streaming video. Dunn likens the case to “a time capsule that if you broke it open, you would find a BlackBerry, an iPod, and a Blockbuster Video card,” arguing that the DOJ’s case is based on outdated information.
The tech giant also disputes the DOJ’s market definitions. Google claims that the government is artificially segmenting the market to make its case. Dunn argues that the market should be viewed as a two-sided platform of buyers and sellers of online ad inventory.
Potential Outcomes and Broader Implications
If the court finds Google guilty of antitrust violations, the DOJ seeks to enforce significant structural changes. One potential remedy is the sale of Google Ad Manager, the platform that includes Google’s publisher ad server and its ad exchange.
The stakes are high for Google, as the trial could substantially change its business model. This case is part of a broader effort by the DOJ to address alleged monopolistic practices in Big Tech.
Last month, a federal court ruled against Google in a separate case concerning its dominance in online search. In a different case brought by Epic Games, a jury in San Francisco in December ruled that Google’s app store was an illegal monopoly.
This trial is not just about Google; it could set a precedent for how antitrust laws are applied to other tech giants. The DOJ is also pursuing cases against Apple, while the Federal Trade Commission is targeting Facebook parent Meta Platforms and Amazon.
