Google recognized as a monopolist. “He deliberately undertook a number of anti -competitive actions”
In the 115 pages of the justification, Brinem used a sharp language. She wrote: “The plaintiffs proved that Google intentionally undertook a number of anti -competitive actions to get and maintain a monopoly in the field of advertising servers for publishers and display of Display advertising on the open Internet.” In another passage she added: “In addition to depriving rivals, the possibility of competing, the exclusive behavior seriously harmed Google's customers, the competition process and, ultimately, consumers of information on the web.”
How does Google's advertising business work and what was the “binding” of products?
In order for the banner to go to the website, he must go – in a simplified way – through three paths:
- Publisher tool (advertising server) in which the website owner sets its area
- Advertiser tool, where the budget and parameters of the campaign are determined
- A stock exchange that connects both sides in a split second and resolves auction
Google controls each of these steps – DFP/AD Manager system on the publishers 'side, Google Ads and DV360 on the advertisers' side and the ADX Stock Exchange as a central place of the transaction.
The court decided that the company has been closed for years (tying) publisher server with its own stock exchange, maintaining over 90 -percent. Shares in the server market and giving priority to your own auctions at the expense of competitive platforms.
Check also: Google under the magnifying glass of Japanese. The first such order in history towards giants
Google Arguments and half -winning
Google argued that his tools are “simple, affordable and effective”, and integration accelerates auctions and increases publishers' revenues. After the announcement of the judgment of Lee -Anne Mulholland, deputy director of regulatory affairs at Google, announced that Google tools for advertisers and acquisitions, such as DoubleClick, do not harm competition. “We do not agree with the decision about tools for publishers. Publishers have many options and choose Google, because our advertising technologies are simple, cheap and effective,” she commented.
The company announced an appeal and emphasizes that in the part about the advertisers' network it won, because the government – according to the court – defined this market too narrowly.
What are the possible consequences for Google himself? The advertisement accounts for approx. 80 percent. Alphabet's global revenuesand only the sale of places on websites and in applications of other companies brought $ 30.4 billion last year. Now Judge Brinkam asked the pages for “remedies”. The Department of Justice before suggested the division of the advertising empire – Google ad manager (DFP + ADX), and in a parallel case regarding the search engine even selling Chrome browser.
Read also: A great lawsuit against Google. The authors demand a giant amount from the company
Alphabet lost on the stock exchange
Investors reacted with the sale of shares and The Alphabet exchange rate fell after a court decision by 1.4 percent. Analyst Michael Ashley Schulman, on which Reuters cites, called the verdict “turning point” increasing the regulatory risk bonus in the entire BIG Tech sector.
If the court counts the sale of the publisher tools or opening ADX on an equal time, Publishers – from the New York Times to local portals – they could negotiate lower fees and use alternative exchanges without the risk of losing access to the largest budgets advertising. Independent advertising platforms, such as The Trade Desk or Magnite, would also benefit from potential breakdown, which have already noted an increase in quotations after the verdict was announced.
In turn, advertisers – especially smaller companies – can gain greater transparency of fees and a real possibility of bidding outside the Google system, which in theory should reduce the costs of promotional campaigns. The court emphasized that today's structure “significantly harmed the competition process.” On the other hand, The division of the giant's services may mean a period of transitional technological uncertaintybecause Google has been providing integrated protection against advertising fraud and bots for years. It is not perfect, but the company has a lot of achievements in this field.
Check also: Will you pay for access to Google Chrome? The US government wants the sale of browser – the confusion is guaranteed
We can wait many years for changes
The procedure for determining sanctions may take months, and the appeals themselves – years. However, the risk of forced sales of key assets He may lead Google to amicable concessions or accelerate work on more transparent market standards.
Jonathan Kanter, former head of the Antithone Section of the American Department of Justice, in a statement for the American Business Insider, put it this way: “This is a huge victory for the enforcement of antitrust law, the media industry and free and open internet.”
The latest sentence is part of the Washington's offensive against Big Techom. In parallel Meta, Amazon and Apple face similar accusations of blocking competition. As the lawyer Julia Tarver Wood said during the opening of the trial, Google “is not because she is big; he is here because he used his size to suppress competition.”
For the first time since the takeover of DoubleClick in 2007, he is real The option that the Google advertising ecosystem will be dismantled. Even if the formal division does not occur, the process of determining repair means and subsequent negotiations with publishers can open the market to competition and innovation. For online businesses, this can mean a return to a more open financing model from advertising.
Author: Grzegorz Kubera, Business Insider Polska journalist
