Google’s digital ad network declared an illegal monopoly, joining its search engine in penalty box

SAN FRANCISCO AP Google has been branded an abusive monopolist by a federal judge for the second time in less than a year this time for illegally exploiting several of its online marketing system to boost the profits fueling an internet empire right now worth trillion The ruling issued Thursday by U S District Judge Leonie Brinkema in Virginia comes on the heels of a separate decision in August that concluded Google s namesake search engine has been illegally leveraging its dominance to stifle competition and innovation After the U S Justice Department targeted Google s ubiquitous search engine during President Donald Trump s first administration the same agency went after the company s lucrative digital advertising organization in during President Joe Biden s ensuing administration in an attempt to undercut the power that Google has amassed since its inception in a Silicon Valley garage in Although antitrust regulators prevailed both times the battle is likely to continue for several more years as Google tries to overturn the two monopoly decisions in appeals while forging ahead in the new and highly lucrative technological frontier of artificial intelligence The next step in the latest event is a penalty phase that will likely begin late this year or early next year The same so-called remedy hearings in the search monopoly matter are scheduled to begin Monday in Washington D C where Justice Department lawyers will try to convince U S District Judge Amit Mehta to impose a sweeping punishment that includes a proposed requirement for Google to sell its Chrome web browser Brinkema s -page decision centers on the marketing machine that Google has spent the past years building around its search engine and other widely used products and services including its Chrome browser YouTube video site and digital maps The system was largely built around a series of acquisitions that started with Google s billion purchase of online ad specialist DoubleClick in U S regulators approved the deals at the time they were made before realizing that they had given the Mountain View California company a platform to manipulate the prices in an ecosystem that a wide range of websites depend on for revenue and provides a vital marketing connection to consumers The Justice Department lawyers argued that Google built and maintained dominant arena positions in a equipment trifecta used by website publishers to sell ad space on their webpages as well as the innovation that advertisers use to get their ads in front of consumers and the ad exchanges that conduct automated auctions in fractions of a second to match buyer and seller After evaluating the evidence presented during a lengthy trial that concluded just before Thanksgiving last year Brinkema reached a decision that rejected the Justice Department s assertions that Google has been mistreating advertisers while concluding the company has been abusing its power to stifle competition to the detriment of online publishers forced to rely on its architecture for revenue For over a decade Google has tied its publisher ad server and ad exchange together through contractual policies and technological integration which enabled the company to establish and protect its monopoly power in these two markets Brinkema wrote Google further entrenched its monopoly power by imposing anticompetitive policies on its customers and eliminating desirable product features Despite that rebuke Brinkema also concluded that Google didn t break the law when it snapped Doubleclick nor when it followed up that deal a scant years later by buying another organization Admeld The Justice Department failed to show that the DoubleClick and Admeld acquisitions were anticompetitive Brinkema wrote Although these acquisitions helped Google gain monopoly power in two adjacent ad tech markets they are insufficient when viewed in isolation to prove that Google acquired or maintained this monopoly power through exclusionary practices That finding may help Google fight off any attempt to force it to sell its advertising tool to stop its monopolistic behavior The Justice Department didn t straightaway comment on the judge s decision In a message Google reported it will appeal the ruling We disagree with the Court s decision regarding our publisher tools commented Lee-Anne Mulholland Google s vice president of regulatory affairs Publishers have a large number of options and they choose Google because our ad tech tools are simple affordable and effective Analysts such as Brian Pitz of BMO Markets had been predicting that Google would likely lose the situation helping to brace investors for the latest setback to the company and its corporate parent Alphabet Inc whose shares declined in afternoon trading Alphabet s stock has plunged by so far this year As it did in the search monopoly incident Google and its corporate parent Alphabet vehemently denied the Justice Department s statements Their lawyers argued the governing body largely based its matter on an antiquated concept of a area that existed a decade ago while underestimating a highly competitive industry for advertising spending that includes the likes of Facebook parent Meta Platforms Amazon Microsoft and Comcast The domain as drawn in the Justice Department s development didn t include ads that appear on mobile apps streaming television services or other platforms to which internet users have increasingly migrated prompting Google lawyer Karen Dunn to compare the regime s definition a time capsule with a BlackBerry an iPod and a Blockbuster video card during her opening message when the trial began last September At trial the Justice Department s lawyers emphasized the harm to news publishers that has arisen from Google s alleged dominance of the marketplace Spectators from Gannett the publisher of USA The present day and other newspapers and News Corp the publisher of The Wall Street Journal testified about the difficulties they have faced and what they mentioned was a lack of alternatives to Google s ad tech Those companies rely on online advertising to fund their news operations and make their articles free to consumers on the internet executive lawyers have argued Now authorities is in position to try to dismantle that byzantine ad system When the affair was filed more than two years ago during the Biden administration the Justice Department asserted Google should be forced to sell at a minimum its Ad Manager product which includes the innovation used by website publishers and the ad exchange