Google just lost a major ad tech antitrust case. What happens next could rewire the web

Google has acted illegally to maintain a dominant position in online advertising, a federal judge ruled on Thursday. The tech giant’s “exclusionary conduct substantially harmed Google’s publisher customers, the competitive process, and, ultimately, consumers of information on the open web,” Judge Leonie Brinkema wrote in her 115-page ruling, which followed another federal judge’s ruling last year that Google had monopolized the search market.

Google was found “liable under Sections 1 and 2 of the Sherman Act” for actions in the ad exchange and tool sectors, but not that it operated a monopoly on ad networks. Google told Fast Company it disagreed with the court’s decision, and would appeal it. “We won half of this case and we will appeal the other half,” said Lee-Anne Mulholland, vice president, regulatory affairs, in a statement. 

The latest decision is a big hit to the company, and acts as a prelude to further crackdowns in other jurisdictions, which some suggest could impact its operations. “This is a very big deal,” says Stacy Mitchell, co-director at the Institute for Local Self-Reliance. “The chokehold that Google​ has over the flow of information​ and ideas online, and its power to pocket the ad dollars, has been killing off local news outlets and undermining a key foundation of democracy.”

 Jason Kint, CEO of the trade association Digital Content Next, says the ruling “underscores the global harm caused by Google’s practices, which have deprived premium publishers worldwide of critical revenue, undermining their ability to sustain high-quality journalism and entertainment.” Kint believes the decision “is a significant step toward restoring competition and accountability in the digital advertising ecosystem.”

Yet for all the headlines the decision will generate, there’s still uncertainty about how much it’ll change Google’s practices—and the wider web. While there’s a recognition that the decisions will likely change how Google works, what impact that will have is uncertain. “Frankly, the ad exchange market is so complicated that it’s hard to know what the impact of any changes to Google’s operations in that area might mean for internet users,” says Anupam Chander, a law professor at Georgetown University. 

Chander believes any changes compelled by this decision may not immediately be obvious to rank-and-file users. “If Google is forced to spin out its ad exchange market or forced to open it up to more competitors, it’s not clear that the results will be visible to users,” he says. The ruling could also present a Catch-22: While it may open up the ad market and benefit online publishers, it could also lead to increased data collection of users (since a raft of third parties would compete to gather more data on users to supplant Google’s current single supply).

 Still, the decision, whatever it means for end users, is another drumbeat in a wider shift in power between big tech giants and the governments trying to regulate them. And while attention is on the U.S. right now, it’s decisionmaking elsewhere that could have the more longer-lasting impact on the web. The U.S. court’s decision will likely energize European regulators, who are conducting their own investigation into Google’s ad tech practices. A decision there is expected imminently—and could carry more weight.

“After years of imposing fines that Google has shrugged off as a mere cost of doing business, the European Commission has the chance to break free from this cycle of whack-a-mole enforcement,” says Stephen Kinsella, an independent legal expert with 30 years of experience in antitrust regulation.

European regulators may be prepared to go further than their American counterparts, potentially reshaping the digital ecosystem by compelling the breakup of Google’s intertwined businesses. “By taking decisive action and mandating a structural break-up, the EU can go beyond slapping big tech companies on the wrist,” says Kinsella. “It can restore a thriving, competitive and fair digital economy that works for its citizens, not entrenched monopolies. This is a moment that Europe cannot afford to let pass.”

https://www.fastcompany.com/91318768/google-loses-major-ad-tech-antitrust-case?partner=rss&utm_source=rss&utm_medium=feed&utm_campaign=rss+fastcompany&utm_content=rss