The Department of Justice (DOJ) filed an antitrust lawsuit against Google last week, accusing the tech giant of abusing its dominance in the digital advertising market and threatening to dismantle parts of its business.
The US government said it believes Google should sell its sell-side advertising assets, Ad Manager Suite, a line of business which accounts for around 12% of Google’s revenues and also plays an important role in the search engine company’s overall sales. This includes not only ads in the search environment, but also the technologies for embedding ads on company websites. Advertisers criticize, among other things, that Google acts with insufficient transparency.
The proceedings regarding the case are scheduled to open in September 2023.
Stronger Case Against Google This Time?
Digital policy consultant Kristina Podnar said while there is increased competition in the online ad marketplace — from rivals including Apple, Microsoft and social media companies including Facebook parent company Meta — Google essentially still dominates.
“It’s moving in the right direction, but can somebody else compete with [Google parent company] Alphabet? Not really,” she said. “I think that’s where the DOJ is coming from.”
Podnar added she thinks this is the first time the DOJ has a strong enough case that’s going to stick.
“It’s about how Google is cornering the marketplace and how its monopolistic behavior is spanning the entire industry,” she said. “I do think that the DOJ case has a lot of teeth this time around.”
Few Surprised by DoJ’s Action Against Google
Andrew Savitz, CMO of Azul, a Java platform, said it’s not surprising that the DOJ is going after Google.
“Google has been the dominant leader in the ad tech space in both the US and world for over a decade,” he said. “Just look at its platforms Google Search, Youtube, Google Ads, Google Analytics, DV360, SA360, to name a few.”
While some of the platforms, such as SA360, integrate with rival ad tech companies like Facebook and Microsoft Advertising, the platform is still predominantly focused on ease of integration with the Google ad-tech ecosystem and ad formats to drive ad revenue.
He explained there is a general feeling amongst businesses that you must appear on the first page of the search engine results (SERPs), either through organic or paid.
“For large companies who compete directly with Alphabet companies, it doesn’t always feel like an even playing field because it’s hard to tell if Alphabets’ own companies benefit over others based on how their digital content appears in the search engine results,” Savitz said.
He pointed out one challenge businesses have faced over the last decade is a decrease in organic traffic. The cause of this is twofold, Savitz said: First, as Google has updated its SERPs layout and design, the organic listings and nonpaid opportunities for business to appear have moved further down the page, causing a reduction in “free” organic traffic.
Second is the increase in no-click searches — users search on Google, and, in many instances, Google is pulling content directly from the third party sites and including it at the top of the SERP as an instant answer or part of the knowledge pane.
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