Google Faces New Antitrust Trial After 'Search Monopoly' Verdict

UNITED STATES – A trial beginning on Monday September 9, will see the US Department of Justice (DoJ) argue that Google advertising policy has been exploiting its dominant position to control the ad tech market, stifling competition and innovation.

The US government is ready to challenge Google’s dominance of the digital advertising sector, accusing Google’s parent company Alphabet of maintaining an illegal monopoly. Digital advertising is a core revenue driver for Alphabet, which generated more than $200 billion from online ads last year alone.

While Alphabet’s success brings our attention to the effectiveness of its marketing tools which the company uses, prosecutors have shown that the parent company has abused the Google ads monopoly to edge out other competitors and restrict advertisers’ options.

“It’s an industry that extracts billions of dollars from consumers in a year. And any consumer has a stake in that case,” explained Laura Phillips Sawyer, a professor at the University of Georgia School of Law.

“It’s however an opportunity all the consumers would want to participate in,” Sawyer added.

This case marks Google’s second high profile anti-trust battle in the US in just a few months. About a month ago, a US court ruled that Google abused its dominance in the online search engine market. However, the penalties to that ruling have yet to be clarified.

The upcoming antitrust Google trial could affect the tech giant’s business practices and the broader online advertising industry in the long run, and it could even reach a point where it could restructure how ads are bought and sold.

DoJ’s Unfair Competition Claims

The 2023 lawsuit filed by the DoJ and several States, alleged that Google advertising policy controls the digital ad space in its hands and restrains competition.

However, Google contends that it is just one of many players in the advertising space. In response to the lawsuit, and in a blog post related to the 2023 lawsuit filed against it by authorities, Google brought up the growing ad revenues of Apple, Amazon, and TikTok as evidence that the market remains competitive.

Both sides will present their arguments before US District Judge Leonie Brinkema, who will determine whether Google’s practices violate antitrust laws. The Google antitrust trial follows a recent decision by Judge Amit Mehta, which found that Google unlawfully suppressed competition in the online search business.

“Google is a monopolist, and it has acted as one to maintain its monopoly,” Judge Mehta wrote in his decision.

Proving a Monopoly Complexities

Google’s defense in this case is expected to echo its argument from last year, where it claimed that its dominance in online search stemmed from offering a superior product.

When asked for a statement, Google pointed to its 2023 blog post, quoting, “no-one is forced to use our advertising technologies – they choose to use them because they’re effective.”

Experts believe the complexity of ad technology could pose a challenge for the DoJ in proving its case.

“We all use search. We all intuitively understand that product,” said Rebecca Haw Allensworth, an antitrust professor at Vanderbilt University Law School. However, the technology that underpins digital advertising is “so complex that I think that’s going to be a real challenge for the government to make a clear, simple monopolization argument here.”

The search engine parent’s ad tech practices are also facing heavy scrutiny outside of the US.

In the UK, the Competition and Markets Authority (CMA) recently revealed that it believes Google has been abusing its dominance in the ad tech market, following an initial investigation. The CMA’s findings suggest that the Google advertising policy behavior may be harming thousands of UK publishers and advertisers through anti-competitive practices.

Google, however, has rejected these conclusions, calling them the result of a “flawed” understanding of the ad tech industry.

Inside Telecom provides you with an extensive list of content covering all aspects of the tech industry. Keep an eye on our Tech sections to stay informed and up-to-date with our daily articles.