US seeks Google ad business divestiture amid monopoly claims

The US Department of Justice (DoJ) plans to compel Alphabet, Google's parent company, to divest significant segments of its digital advertising business.

The development comes after a federal judge found Google's ad operations to constitute an illegal monopoly.

According to the DoJ, divestments of Google's ad exchange and publisher ad server businesses are necessary to dismantle its market dominance.

During a hearing in a federal court in Virginia, US government lawyer Julia Tarver Wood, as reported by The Guardian, said “We have a defendant who has found ways to defy” the law, emphasising that the company's past actions undermined its credibility.

Wood further argued that simply allowing “a recidivist monopolist” to continue operating without structural remedies would not be an effective solution to the problem.

Google's ad exchange is said to be the largest marketplace for bidding on online ad space, while the publisher ad server is the technology used by online publishers to list and sell ads on their websites.

Additionally, the DoJ has proposed that Google be required to share data on real-time ad bidding with competitors.

A trial date has been set for 22 September by the US District Judge Leonie Brinkema to review these proposals and Google's counterarguments.

In a previous ruling, Judge Brinkema determined that Google had “wilfully” monopolised the online advertising market through acquisitions and by integrating its ad exchange and publisher server, effectively excluding competitors and undercutting them on pricing.

However, the judge dismissed part of the DoJ's case, stating it failed to prove Google unfairly dominated advertiser ad networks.

Google has contested the ruling, asserting that it competes with other tech companies such as Meta, Amazon, and TikTok for online ad spending.

Google’s head of regulatory affairs Lee-Anne Mulholland, according to the Financial Times, said: “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.”

The antitrust case marks the third such challenge Alphabet has faced recently.

Last year, a judge found that Google had developed a monopoly in search by paying Apple over $20bn annually to be the default browser on its devices.

The DoJ has since requested Google to sell its Chrome browser and share search data with competitors.

"US seeks Google ad business divestiture amid monopoly claims " was originally created and published by Verdict, a GlobalData owned brand.