DOJ says Google has ‘triple monopolies’ on first day of ad tech trial

Another U.S. Justice Department monopoly trial against Google began in Virginia on Monday — this time aimed at challenging the tech giant’s dominance of the advertising technology market.

The trial comes after Google lost two major cases that proved it has a monopoly on both general search and the Android app store. During her opening statement, Justice Department attorney Julia Tarver Wood told U.S. District Judge Leonie Brinkema — who will rule on the case after Google wrote a check to avoid a jury trial — that “it’s worth saying the quiet part out loud,” AP News reported.

“One monopoly is bad enough,” Wood said. “But here we have a trifecta of monopolies.”

In its complaint, the Justice Department argued that Google had crushed competition in the ad technology space “by waging a systematic campaign to seize control over a broad array of technologically advanced tools used by publishers, advertisers, and brokers to facilitate digital advertising.”

The result of this “underhanded,” allegedly anticompetitive behavior, the DOJ says, is that Google now pocketed at least 30 cents “of every advertising dollar that flows from advertisers to website publishers through Google’s ad technology tools… and sometimes significantly more.”

Meanwhile, because Google makes money from both advertisers and publishers, “website creators earn less and advertisers pay more” than they would “in a market where unfettered competitive pressures could discipline prices and lead to more innovative ad technology tools,” the Justice Department says.

On Monday, Wood told Brinkma that Google had deliberately put itself in this position to “manipulate the rules of the ad auction to its own advantage,” The Washington Post reported.

“Understandably, publishers were furious,” Wood said. “The evidence will show there was nothing they could do.”

Wood confirmed that the Justice Department plans to call several publishers to the stand in the coming weeks to explain the harm they caused. “Executives from companies including USA Today, the (Wall Street) Journal parent company News Corp. and the Daily Mail are expected to testify,” the Post reported.

Experts say the ad tech trial, which is expected to last four to six weeks, could be the most serious antitrust case Google has faced recently.

That’s because during the DOJ’s trial, which sought to prove Google’s search monopoly, it was unclear what remedies the DOJ was seeking. Some of the ways to break up Google’s search monopoly could “not create significant competition” or hurt Google’s bottom line, experts told Ars, but a more drastic order to spin off the Chrome browser or Android operating system could really hurt Google’s revenue. The DOJ won’t release a broad outline of its proposed remedies in the case until December, Reuters reported, and the judge isn’t expected to issue a ruling until next August.

But the Justice Department has made clear the remedies needed in the ad tech case, “requesting Brinkman issue an order to sell Google’s Ad Manager suite of services, which is responsible for many of the rectangular ads that appear at the top and sides of web pages,” the Post reported.

Since the most “obvious” solution would be to require Google to sell off part of its advertising business, experts told AP News that the ad tech lawsuit “could potentially be more damaging to Google” than the search lawsuit. Perhaps in the most extreme case, antitrust expert Shubha Ghosh told Ars that “if this case goes against Google like the last one, it could set the stage for a split into separate search and advertising businesses.”

In the DOJ complaint, prosecutors argued that it was “important to restore competition in these markets by imposing an injunction prohibiting Google from engaging in anticompetitive practices, reversing Google’s anticompetitive acquisitions, and imposing a remedy sufficient both to deprive Google of the fruits of its illegal conduct and to prevent further future harm to competition.”

Ghosh said that undoing the Google acquisitions could result in Google no longer representing the interests of advertisers and sellers in each ad auction – instead having to take sides or involve an intermediary.

Although the Post reported that Google argued that “customers prefer the convenience of a one-stop-shop for all the information they need,” the Justice Department hopes to prove that Google’s alleged monopoly has shut down newspapers across the U.S. and threatens to do even more harm if left unchecked.