For the second time in less than a year, a federal court has dealt a blow to Google's business model, ruling that it holds an illegal monopoly in a key sphere of its operations.
U.S. District Judge Leonie Brinkema ruled Thursday, in a federal court in Virginia, that Google is a monopolist in the area of online advertising, and that its dominant ad network has stifled the competitive market for web ads over the last decade or more.
"Plaintiffs have proven that Google has willfully engaged in a series of anticompetitive acts to acquire and maintain monopoly power in the publisher ad server and ad exchange markets for open-web display advertising," Brinkema said in her 115-page ruling.
"In addition to depriving rivals of the ability to compete, this exclusionary conduct substantially harmed Google’s publisher customers, the competitive process, and, ultimately, consumers of information on the open web," the judge added.
As the New York Times explains, the government's argument held that Google holds a monopoly over three segments of the online ad marketplace: the tools advertisers use to buy ad space, the tools that publishers use to place those ads on their content, and the software that sets prices and facilitates those transactions.
The case partly hinges on some acquisition history — the government approved Google's purchase of online ad juggernaut DoubleClick way back in 2008, not realizing, apparently, that it was handing Google a potential monopoly over how online ads are bought and sold.
Google/Alphabet's lawyers, meanwhile, maintained that the Justice Department was way behind the times in its thinking about online ads and how they're delivered, and suggested that much had changed just in the last few years about how and where consumers see ads.
During her opening statement in September, as the Associated Press recalls, Google lawyer Karen Dunn compared the government’s notion of the online ad space to a "time capsule with a BlackBerry, an iPod and a Blockbuster video card." Google now actively competes with Meta, Amazon, Microsoft, and Comcast for ad dollars, the company's lawyers argued, and the government's case fails to account for the migration of eyeballs from the standard web to mobile apps and social media in particular.
Google has vowed to appeal this decision, just as it is appealing last August's decision in a different federal court that found the company to be a monopolist in web search.
The remedy phase in that first case is set to begin Monday, the outcome of which will dictate how Alphabet will be compelled to proceed — with one potential outcome being an order that it sell off its Chrome web browser.
Meta, similarly, is facing antitrust action from the Trump administration, though from the Federal Trade Commission rather than the Justice Department. Wending its way through legal channels for five years has been a case that accuses Meta of anticompetitive behavior in its decade-old acquisitions of Instagram and WhatsApp. And, similarly to Google's lawyers, Meta's lawyers are arguing that the government's case is based on an already archaic notion of the social media landscape, ignoring major competitors like TikTok and YouTube.
In any case, even if Google loses its appeals, it will likely be years before we see any changes imposed on how Google does business.
Previously: Google Has Illegal Monopoly Over Web Searching, Federal Judge Rules
Photo: Greg Bulla
