U.S judge determined that Google holds unlawful monopoly in ad technology

A U.S. judge ruled on April 17 that Google unlawfully monopolized the online advertising technology market, significantly impacting the company’s revenue. 

The federal government, alongside more than a dozen states, initiated an antitrust lawsuit against Google, the parent company of Alphabet, alleging that it employed illegal tactics to dominate three critical sectors of digital advertising: publisher ad servers, advertiser tools, and ad exchanges. This lawsuit is one of two significant federal cases against Google and could potentially result in the company’s breakup, thereby diminishing its power in the tech industry. 

The plaintiffs argued that most websites depend on Google’s suite of ad software, leaving publishers with no real alternatives.

District Court Judge Leonie Brinkema largely supported these claims, determining that Google had established an illegal monopoly over the ad software and tools utilized by publishers, although she did dismiss some allegations concerning advertiser tools. 

In her ruling, Judge Brinkema noted that Google had engaged in a series of anticompetitive actions to acquire and maintain monopoly power in the publisher ad server and ad exchange markets, which adversely affected competitors and publishers. 

In response to the ruling, Google announced plans to appeal. Lee-Anne Mulholland, Google’s vice president of regulatory affairs, said, “We won half of this case and we will appeal the other half,” emphasizing that the court found no harm to competition from their advertiser tools or acquisitions like DoubleClick.

Evelyn Mitchell-Wolf, a senior analyst at eMarketer, emphasized that the recent ruling indicates a notable change in antitrust actions targeting Google and other major players in digital advertising. 

She highlighted that the implications of the case will largely hinge on the legal remedies enforced, which may take years to materialize if Google is unsuccessful in its appeals. 

This case is part of a larger initiative by the U.S. government, spanning both the Trump and Biden administrations, to adopt a more assertive approach to antitrust enforcement, marking a departure from the relative inactivity seen since the late 1990s Microsoft case. Alongside the current online ad technology case, Google is also under scrutiny for its monopolistic practices in the search engine market, with a U.S. judge ruling last August that the company holds a monopoly in that sector, a decision that Google is contesting. 

The resolution of this case could have far-reaching effects not only for Google but also for the entire advertising industry, as any shifts in its market dominance could significantly impact publishers who depend on Google’s technology for their revenue.