Google is once again in the legal spotlight as the U.S. Department of Justice (DOJ) prepares to challenge its dominance in the online advertising market. On Monday, a trial begins in the U.S. District Court for the Eastern District of Virginia, where federal prosecutors accuse Google of abusing its control over ad technology and violating antitrust laws.
This marks the second major antitrust trial Google faces in less than a year. In August, a federal judge ruled that the company had illegally maintained a monopoly in online search, a significant win for the DOJ. The new trial targets Google’s ad technology, specifically the company’s role in the online ad ecosystem, where its tools are used to place ads on websites around the world.
Google’s Advertising Technology Under Scrutiny
The DOJ’s case centers on Google Ad Manager, a suite of tools that dominates the online advertising market by facilitating real-time ad auctions each time a webpage is loaded. According to government officials, Google controls about 87% of the U.S. market for ad-selling tools used by publishers. The DOJ claims this dominance allows Google to inflate prices for advertisers and publishers, ultimately harming industries like news media that rely heavily on ad revenue.
In 2021, Google’s ad technology generated approximately $31.7 billion in revenue. While this represents only a small fraction of the company’s total profits, the DOJ argues that Google’s monopoly in this space creates broader economic consequences by making it harder for smaller businesses and news outlets to survive.
A Call for a Breakup
The DOJ’s lawsuit goes beyond simply asking for fines or penalties—it calls for a breakup of Google’s advertising business, including its divestiture of DoubleClick, a company Google acquired in 2008 for $3.1 billion. DoubleClick’s technology has become integral to Google’s ad operations, but the DOJ claims that its acquisition allowed Google to stifle competition.
“A government win could require the sale of DoubleClick and other ad tech acquisitions,” said Doug Melamed, a former acting assistant attorney general for the DOJ’s antitrust division. Such a breakup could reshape not only Google but also the entire online advertising industry, which depends heavily on Google’s tools.
Google’s Defense
Google argues that its success in the ad tech business is due to its superior technology and that it faces stiff competition from other platforms, including social media and mobile apps. In a blog post, Lee-Anne Mulholland, Google’s vice president for regulatory affairs, criticized the DOJ for “picking winners and losers in a highly competitive industry,” adding that “the market is working” with ad prices decreasing and more ads being sold.
Google has also pushed back against the idea that it holds an unfair advantage, stating that its advertising tools are constantly evolving to meet the demands of a shifting digital landscape. “Millions of small, medium, and large businesses choose Google’s ad tech ecosystem because it works,” the company said in a court filing in August.
Broader Implications for Big Tech
The trial is part of a larger wave of antitrust actions targeting Big Tech. The DOJ has filed similar lawsuits against other tech giants like Apple, Amazon, and Meta, accusing them of abusing their market power to stifle competition. These cases are seen as a test of century-old antitrust laws against modern tech companies that have reshaped global commerce and communication.
More Read
In addition to Google’s current trial, its previous antitrust case involving its search engine is still progressing. Judge Amit P. Mehta of the U.S. District Court for the District of Columbia is expected to decide on potential remedies by next August, with the DOJ considering further action, including a possible breakup of Google’s search business.
Impact on the Ad Industry
If the government succeeds in forcing Google to divest parts of its ad tech business, it could have far-reaching effects on the digital advertising ecosystem. The online advertising market is crucial to the “free” internet model, where consumers can access content without paying, while publishers rely on ad revenue to fund their operations.
William Kovacic, a former chairman of the Federal Trade Commission, said that forcing Google to sell off its ad tech assets would “very directly change an industry structure that’s made [Google] enormously powerful.” Similarly, Roger Alford, a law professor at the University of Notre Dame, noted that the ad tech issues at the heart of the case could significantly alter how online content is monetized, especially for smaller publishers and media companies.
A Landmark Case for the Tech Industry
Antitrust experts are closely watching the trial, as it may set a precedent for future legal challenges against other tech giants. Daniel Francis, a law professor at New York University, called the case a “huge bellwether,” especially as it involves practices that are prevalent across the tech industry. The DOJ’s claims that Google built its dominance through acquisitions echo similar cases brought against Meta, Facebook’s parent company, and Apple.
As the trial unfolds over the coming weeks, testimony from representatives of news publishers, including News Corp, Vox Media, and The New York Times, is expected to play a critical role in determining whether Google’s control of the ad tech industry truly amounts to illegal monopolistic behavior.
