Deja Vu for Google as US revives antitrust push in ad business trial

Deja Vu for Google as US revives antitrust push in ad business trial

Facing another attempt to dismantle its internet empire, Google is in a trial focused on its abusive tactics in digital advertising, just after fending off the U.S. Justice Department's attack on its illegal monopoly in online search. Starting Monday in an Alexandria, Virginia, federal court, the trial will revolve around the harmful conduct that led the U.S. District Judge Leonie Brinkema to declare parts of Google's digital advertising technology an illegal monopoly. The judge found that Google's behavior stifles competition, harming online publishers who rely on the system for revenue.

Over the next two weeks, Google and the Justice Department will present evidence in a "remedy" trial. This will culminate in Brinkema's ruling on how to restore fair market conditions. A decision isn't expected before the end of the year, as additional legal briefs and arguments are anticipated to last until November. Regardless of the outcome, Google has stated it will appeal the monopoly decision, though it cannot do so until the remedy is determined.

Details of the case

Filed in 2023 under President Joe Biden's administration, the case threatens the complex network Google has spent the last 17 years building. This dominant digital advertising business accounts for most of the $305 billion in revenue for its parent company, Alphabet Inc., and provides the essential revenue for thousands of websites.

The Justice Department is pushing for Brinkema to order Google to sell parts of its ad technology. Google's lawyers warn this would "invite disruption and damage" to consumers and the internet's ecosystem. 

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The Justice Department, however, argues that a breakup would be the most effective and quickest way to dismantle a monopoly that has been stifling competition and innovation for years. Google believes its recent changes to its "Ad Manager" system, including more options and pricing, are sufficient to resolve the issues.

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Google’s search engine case

This legal battle mirrors a recent one over Google's search engine, where a different federal judge, U.S. District Judge Amit Mehta, also condemned it as an illegal monopoly. In that case, the Justice Department proposed a severe crackdown, including forcing Google to sell its Chrome browser. Mehta, however, ruled that a less dramatic shake-up was needed due to the search market being reshaped by AI technology.

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Mehta's decision, issued earlier this month, was widely seen as a "slap on the wrist," which has helped propel Alphabet's stock price to new highs. The 20 percent gain since the ruling helped Alphabet become the fourth publicly traded company to reach a market value of $3 trillion.

In a sign that the search case's outcome might influence the ad tech proceedings, Judge Brinkema has asked both sides to address Mehta's decision during the upcoming trial. Google's lawyers are already arguing that new AI technology from rivals like Meta Platforms is transforming the market, making the Justice Department's "radical" proposals unnecessary. They contend the department is "fighting for a remedy that would vanquish a past that has been overtaken by technological and market transformations".

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