News Corp would have lost $9 million in 2017 by cutting Google ads, former exec testifies

By Jody Godoy

ALEXANDRIA, Virginia (Reuters) – News Corp estimated in 2017 that it would lose at least $9 billion in advertising revenue if it cut Google’s advertising powerhouse, keeping the media conglomerate in the thrall of Big Tech Company, a former News Corp executive testified on Tuesday.

“I felt like they were holding us hostage,” Stephanie Layser said on the second day of Google’s antitrust trial in Virginia.

Google disappointed publishers by introducing features that were more beneficial to it than to them, said Layser, who worked in ad technology at News Corp. from 2017 to 2022. But almost no one in the industry used anything else because Google’s ad server for publishers is tied to Google’s ad exchange, she added.

The trial is expected to last several weeks, with the US Department of Justice seeking to prove that Google has a monopoly on the market for publishers’ ad servers, advertisers’ ad networks and the ad exchanges that connect the two.

NewsCorp documents presented at the hearing estimated that in 2016, the publisher made $83.3 million from ads sold instantly through ad technology tools. More than half of those sales went through Google’s ad exchange, with $18.4 million coming from Google Ads advertisers.

The publisher estimated that about half of that amount, or $9 million, accrued solely to Google and would be lost if it switched to another product.

At the time of her departure, about 70% to 80% of News Corp.’s advertising transactions were going through the Google ad exchange, Layser said.

Google said the case was based on an outdated view of the industry and that large publishers use an average of six different platforms to sell ads, with the number of such services exceeding 80.

At trial, prosecutors aim to show that Google used its dominant position in the technology market to prevent publishers and advertisers from using other tools and to lower rates for competing products.

Layser was the publisher’s second witness to testify at the hearing. Tim Wolfe, Gannett’s chief advertising officer, testified Monday that the company has been using Google’s publisher ad server for about 13 years and that it has no other realistic options.

The list of potential witnesses includes Google’s ad technology competitors such as The Trade Desk, Comcast and PubMatic, as well as more than two dozen current or former Google employees and executives.

If U.S. District Judge Leonie Brinkema finds that Google broke the law, she will consider prosecutors’ request to order Google to at least sell Google Ad Manager, a platform that includes a publisher’s ad server and ad exchange.

(Reporting by Jody Godoy in Alexandria, Virginia; Editing by Richard Chang)