The US Department of Justice (DoJ) is seeking to compel Google’s parent company, Alphabet, to divest critical components of its digital advertising empire, in a bid to dismantle what a federal judge has ruled an illegal monopoly. According to the Financial Times, the DoJ argued in court filings on Friday that Alphabet must sell off its ad exchange and publisher ad server businesses to break its dominance over online advertising.
These two components form the core infrastructure of Google’s ad tech ecosystem: the ad exchange facilitates real-time bidding for digital ad space, while the publisher ad server enables websites to list and manage ads. The DoJ also asked the court to require Google to share real-time bidding data with competitors, a move it believes is necessary to restore fair competition.
US District Judge Leonie Brinkema has scheduled a trial for September 22 to assess the proposals and Google’s defense. Last month, Brinkema sided with the DoJ in finding that Google had “wilfully” monopolized the digital advertising market by acquiring competitors and tightly integrating its ad exchange with its publisher tools, a strategy that disadvantaged rivals.
However, she dismissed part of the case, stating the DoJ failed to prove Google unfairly dominated advertiser ad networks — the platforms connecting advertisers with inventory.
Google has pushed back strongly. Lee-Anne Mulholland, Google’s head of regulatory affairs, criticized the DoJ’s demands, saying, “The DoJ’s additional proposals to force a divestiture of our ad tech tools go well beyond the court’s findings, have no basis in law, and would harm publishers and advertisers.”
This marks the third antitrust setback for Alphabet in recent years. The company has already been found to have monopolized search by paying Apple over $20 billion annually to remain the default browser on iOS devices. In that case, the DoJ has requested Google divest its Chrome browser and share search data with competitors.
Alphabet CEO Sundar Pichai testified in a separate Washington trial earlier this week, calling the remedies proposed by the DoJ “so extraordinary” that they would effectively give away Google’s intellectual property, jeopardize user privacy, and allow rivals to reverse engineer its technology.
In yet another blow, Alphabet has also been ordered to open up its Android operating system, following a ruling that it used the Google Play Store to stifle competition and extract excessive fees from app developers.
