Alphabet’s Google is going to appear before one of the most massive antitrust trials the following week. The U. S. Department of Justice (DOJ) will contend with how Google profits from its advertising platform that prosecutors say is detrimental to news providers. This case fits into the overarching Biden administration policy of regulating Big Tech through antitrust laws.
The trial is set to commence on Monday in Alexandria, Virginia, after the DOJ secured a significant win last month. On August 5, the judge said that Google engaged in unlawful monopolization of net search. Details of this trial seem to involve different technologies from Google known search engine; rather it will involve Google technologies that bring together website publishers and advertisers.
Advertising tools are quite strategic in Google’s operations and they contributed more than 75% to the company’s $307 billion revenue. Be it the well-known companies or the new startups, the companies generating up to 4 billion in revenue last year. As Brian Wieser, an analyst in advertising and a financial consultant said, “Google is more than twenty times the size of the next biggest seller of advertising globally.” “They influence each aspect of the industry, if not in the first or second degree, then at least in passing. ”
Google’s Ad Market Dominance
One of the key accusations, which the DOJ, together with several states, would like to make is that Google engaged in antitrust violations found in the U. S. digital advertising market. The possibility of this is not lost in the event of a triumph by the DOJ for it may lead to the breakup of Google. The DOJ claims that Google controls ad markets by bundling the tools or services used by the publishers and advertisers and presents itself as a very important ‘Go-Between.’
Google refutes these claims claiming that it does not have to give its technology to its rivals hence its products are complementary to those from other industries. The DOJ stated that Google dominates ad-serving market with having 91% market share and more than 50% of ad exchange market. As for Google’s response, it claims it holds less market share when competition is calculated with social media, streaming, and apps.
The trial will also involve addressing a question about Google and the harm it has caused to the news industry through its ad technology. The study published by the faculty of North Western University shows that about one third of the newspapers in the United States have shut down or changed hands since the year 2005. The head of the Department of Justice’s antitrust division, Jonathan Kanter, noted that “Journalism is under threat in large part due to consolidation in the advertising market.”
Some potential high profile witnesses may include executives from News Corporation, the Daily Mail, and Gannett among others. Google’s strategy is to summon witnesses from small businesses and publishers to show the negative impact of having the company broken apart for small companies on the aspect of innovation and advertising costs.
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