The US government is challenging Google in court. It accuses the company of unfairly dominating the online ad industry and forcing it to sell parts of its tech business.
The US government is again trying to lessen Google’s market power. This time, it’s based on its rather monopolistic position in the online advertising market. At the start of a trial on Monday in Virginia Federal Court, the Department of Justice levied anti-trust charges against Google.
It accused Google of dominating the ad tech market, especially for small news outlets. The government claims the company charges higher advertising prices, decreasing publishers’ revenues.
This is the second massive antitrust proceeding against Google within a year. A judge had earlier found it guilty of antitrust laws concerning its search engine business. Now, LimeLight is on the ad technology, which decides which ads run on the Internet and for how much.
The government case centers on Google abusing its market dominance by placing website banner ads. The Department of Justice reveals that Google’s power allows the company to charge advertisers more but pay publishers less. This has a detrimental effect on small news companies that depend on ad revenue.
Julia Tarver Wood is an attorney for the Department of Justice. She claims that Google abused its economic dominance to acquire potential rivals and monopolize the ad tech market. She argues that the company had acquired unparalleled dominance over the tools required for online advertising, which thus excludes meaningful full options for advertisers and publishers.
Google ad tech serves over 13 billion display advertisements daily. Advertisers collect approximately $12 billion in revenues, with over 90% passing through the Google ecosystem.
The government wants Google to break up this Monopoly by forcing it to sell off parts of its ad tech business.
Google defends its position
Google’s lawyer, Karen Dunn, responded to the government’s claims, saying that they do not depict the entire picture of the ad market. She noted that the trial pertains only to display ads, a limited subset of the overall tech sphere.
She further stated that there are many other forms of advertising. Search results and social media advertisements are doing well without Google’s influence.
Dunn added that undermining Google’s ad tech operations would help other big tech players, such as Meta, Amazon, and Microsoft, gain significant market share.
She claimed the government case is outdated for today’s market environment. She urged the dismissal of the charges, citing legal provisions.
During the trial, witnesses – most likely publishing industry representatives – will testify about how beneficial Google’s advertising services are to them. The trial can take several weeks, as the decision can impact the technology sector and online publishing companies.
