Google Seeks to Avoid Breakup of Ad-Tech Business as U.S. Antitrust Trial Closes
Google is making a final effort to prevent the forced sale of its AdX ad exchange business as its U.S. antitrust trial concludes in federal court.
As the antitrust trial against Google draws to a close in a U.S. federal court, the company is making a last effort to avoid a forced breakup of its lucrative advertising technology business. At the heart of the dispute is Google’s AdX ad exchange, which the U.S. Department of Justice (DOJ) and a group of states want the company to sell.
The trial is being held in Alexandria, Virginia, before U.S. District Judge Leonie Brinkema, who in April ruled that Google holds two illegal monopolies: one in the publisher ad-server market, and another in its real-time ad auction marketplace, AdX.
According to Reuters, the DOJ argues that only a divestiture forcing Google to sell AdX can restore genuine competition in the digital ad-tech space. During closing arguments, the public prosecutor stressed that Google’s dual ownership of the exchange and the ad-server gives it too much control over both the supply and demand sides of real-time ad auctions.
While Google strongly resists the idea. According to its lawyers, splitting up the ad-tech business would be technically difficult, prone to errors, and risk disrupting services used by both publishers and advertisers.
However it also claims that the DOJ’s plan could lead to a long, painful transition, hurting its users.
In court, Google expressed that the proposal is “radical and reckless.” Its attorneys warned that a forced sale could threaten the very stability of its ad-tech infrastructure.
On the other side, the DOJ’s case hinges on evidence that Google’s integrated systems suppress competition. In its remedy proposal, the DOJ has asked for Google’s auction logic. Its very own mechanism that determines winning bids to be made open source. They argue transparency would reduce Google’s ability to favour its own services.
Jed Dederick, chief revenue officer at Trade Desk Inc., said that forcing Google to divest AdX would be “the single most important way to restore the trust of ad buyers.”
Meanwhile, Jon Weissman, a computer-science expert, reviewed Google’s ad-tech code and described it as “beautiful to look at,” insisting that a separation of AdX is technically feasible without degrading performance.
Google, though, strongly disputes such views. The company has argued that AdX and its ad-server are deeply intertwined with other parts of Google’s infrastructure, making a clean break very hard.
It also says its own internal studies have considered various options including rebuilding parts of the system for a buyer. but that the DOJ’s divestment demands go well beyond what Google believes is practical.
If the judge orders Google to spin off AdX, it could mark one of the most significant breakups of a Big Tech company in years. But Google has already said it will appeal any adverse decision. Source
