US Takes on Google’s Ad Tech Empire in Antitrust Trial

Google faced its second major antitrust lawsuit in less than a year on Monday, with the U.S. government accusing the tech giant of unfairly dominating the online advertising market and stifling competition.

The trial in federal court in Virginia follows a separate case in which a judge last month found that Google’s search engine was an illegal monopoly.

This new battle, also launched by the U.S. Department of Justice, focuses on ad technology — the complex system that decides what online ads people see and how much they cost.

The U.S. government alleges that Google controls the market for placing banner ads on websites, including those of many content creators and small news providers.

That, lawyers argued, means Google can both charge higher prices to advertisers and pass on less revenue to publishers such as news sites, many of which are struggling to stay afloat.

“The technology may be cutting-edge, but the practices (demonstrated by Google) are as old as monopolies themselves,” Justice Department lawyer Julia Tarver Wood told a packed courtroom.

In her opening speech, Wood said Google had used its financial position to take on potential rivals and monopolize the ad technology market, leaving advertisers and publishers with no choice but to use Google’s technology.

“Through acquisitions, Google has leveraged its monopoly power to create a new set of advertising technology tools that are essential to keeping the internet alive,” she added.

As their revenues fell, “publishers were understandably furious, and the evidence will show there was nothing they could do,” she added.

According to the U.S. government, more than 13 billion display ads are displayed on websites every day, generating about $12 billion for publishers, most of which reaches users through Google’s advertising technology.

The US government wants Google to divest part of its ad technology business.

Karen Dunn, a Google lawyer, rejected the accusations, saying the government was trying to pick “winners and losers” in a diverse market.

She emphasized that the display ads under scrutiny represent only a small portion of today’s ad technology market.

The plaintiffs ignore ads also placed in search results, apps and on social media platforms, where Google generally does not have a dominant position, she said.

“The plaintiffs’ case is a bit of a time capsule,” Dunn said in her opening statement.

She warned that if Google loses the case, the winners will be other tech giants such as Microsoft, Meta and Amazon, whose share of the online advertising market is “growing while Google’s share is falling”.

She added that the case should also be dismissed because of U.S. legal precedent that has overturned similar arguments in previous antitrust cases.

The first witness called by the US government was Tim Wolfe, an executive at Gannett newspaper, publisher of USA Today and hundreds of local news providers in the US.

He told the court his company saw “no alternative” to Google.

He added that the company’s ad technology tools give advertisers access that other technology providers cannot achieve.

The trial is expected to last at least six weeks and call dozens of witnesses. Judge Leonie Brinkema will preside over it.

Her decision on whether Google broke antitrust law will come months after the trial. If it finds guilty, a separate phase of the trial will decide how Google should comply with the judge’s request.

Similar investigations into Google’s dominance of the advertising technology market are ongoing in the European Union and the United Kingdom.

In another case, Google reached a settlement with the French competition authority in 2021 and was fined €220 million ($242 million)