2 weeks Ago By Thomas Claburn
For the second time in less than a year, a federal judge has found that some parts of Google broke US antitrust law. The Chrome titan is spinning the latest ruling as a win, though, as its ad-selling business and the past acquisitions it used to build its ad dominance were given the all-clear for now. In a 115-page memorandum opinion [PDF] published Thursday, Judge Leonie Brinkema of the US District Court for the Eastern District of Virginia ruled Google violated the Sherman Antitrust Act "by willfully acquiring and maintaining monopoly power in the open-web display publisher ad server market and the open-web display ad exchange market, and has unlawfully tied its publisher ad server (DFP) and ad exchange (AdX).
" Judge Brinkema, however, found that the US Justice Department failed to prove its case with regard to Google's "open-web display advertiser ad networks." The Justice Department in January 2023 sued Google , claiming the mega-corp has unlawfully monopolized: The court essentially cleared Google on the second point. But it found Google engaged in anti-competitive conduct on three counts: monopolization of the publisher ad server market (DFP), monopolization of the ad exchange market (AdX), and the unlawful tying of AdX and DFP.
Google put a positive spin on the judgment. "We won half of this case and we will appeal the other half," Lee-Anne Mulholland, Google VP of regulatory affairs, told The Register . "The court found that our advertiser tools and our acquisitions, such as DoubleClick, don't harm competition.
We disagree with the Court’s decision regarding our publisher tools. Publishers have many options and they choose Google because our ad tech tools are simple, affordable and effective." Google's characterization of the decision as a glass half-full, as opposed to a third or a fourth, follows from the judge's finding that Google's DoubleClick acquisition and its AdMeld acquisition – which support the publisher side of Google's ad business – were not anti-competitive.
That's likely to limit the US government's options in terms of remedies. As Google representatives opined during a background briefing with the press on Thursday, a remedy involving divestiture – suggested in government filings – becomes more unlikely when the acquisitions that went into building Google's ad publishing and exchange businesses were given the OK. Although the government brought the case to help web advertisers and publishers break Google's lock on their revenue streams, some pundits think it will have the opposite effect.
Adam Kovacevich, CEO of Chamber of Progress and a former head of US policy for Google, said in a statement, "It’s clearly a loss for Google and a win for its ad tech rivals. But even though some advertisers and publishers cheered this case, I suspect this may end up worsening their ad targeting, raising advertisers’ rates, and decreasing publishers’ revenue. Judge Brinkema applied a novel interpretation of antitrust law that may not survive an appeal.
" It’s clearly a loss for Google and a win for its ad tech rivals Google representatives echoed that opinion during the post-decision media briefing, based on a case known as Verizon Communications, Inc. v. Law Offices of Curtis V.
Trinko, LLP. Google's legal folk suggest that the judge's decision doesn't align with Supreme Court precedent regarding the limits on accommodations companies must make for rivals. In that case, the Supreme Court ruled that Curtis Trinko, an AT&T customer, could not bring an antitrust claim against Verizon for refusing to share its network with rival AT&T.
Essentially, the decision limited the extent to which Verizon is obliged to interoperate with other firms. But as noted in The Yale Law Review, this has become problematic with the rise of platform technology companies. "Courts have substantially narrowed the [antitrust duty to deal] doctrine in recent decades," wrote legal scholar Erik Hovenkamp in 2022.
"However, the rise of dominant platforms like Google, Facebook, and Amazon has provoked intense debate over whether the antitrust duty to deal needs a revival. Many such platforms are accused of refusing to deal with (or discriminating against) rivals in adjacent markets." Google expects its appeal will help clarify the degree to which companies have to provide competitors with access to their systems and technology where competition concerns have been raised.
And although the specter of being forced to calve off parts of its ads business has been dispelled for now, Google still has reason to be concerned about a breakup. The Chocolate Factory will soon learn whether it will be required to shed its Chrome browser as penalty for its earlier antitrust loss. Next week, a three-week hearing is scheduled to determine the remedy for Google's monopolization of the search business .
That possibility has alarmed the web community, particularly Firefox maker Mozilla, because the court's remedy could forbid Google from paying to make its search service the default in web browsers. "Some of the remedies proposed in the case risk the future of our Firefox browser and Gecko browser engine – the last remaining non-Big Tech browser engine," said Mozilla CEO Laura Chambers in a blog post on Thursday, echoing similar concern raised by Mark Surman, president of Mozilla, only a month ago. ®.
