Google found guilty. Will ad business be broken up now?
What's the story
A federal judge in Virginia has ruled that Google illegally established "monopoly power" through its online advertising business.
The landmark decision, handed down by District Judge Leonie Brinkema of the US District Court for the Eastern District of Virginia, backs a Justice Department lawsuit.
The ruling could reshape the basic economics of running a modern website and is a major court victory for the US government against Google.
Antitrust claims
Google accused of monopolizing key internet sectors
Notably, the ruling against Google comes less than a year after the US government won another case, accusing the tech giant of monopolizing major sectors of the internet ecosystem, including online search.
A federal jury also found in December 2023 that Google's proprietary app store is an illegal monopoly.
Together, these three decisions highlight the breadth of trouble Google faces and raise the prospect of sweeping penalties across its business.
Ad monopoly
Judge Brinkema's ruling centers on Google's ad business
Judge Brinkema's ruling specifically targets the $31 billion portion of Google's advertising business that links website publishers with advertisers.
This "stack" of technologies is critical in deciding the banner ads that show up on countless sites across the web.
The Justice Department's lawsuit was filed after years of criticism that Google's extensive role in the digital ecosystem, represented a conflict of interest that Google exploited anticompetitively.
Google reacts
Tech giant responds to ruling, plans to appeal
Google has said it will appeal the ruling, with Lee-Anne Mulholland, Google's Vice President of Regulatory Affairs, saying, "We won half of this case and we will appeal the other half."
Mulholland further clarified that while the court found no harm to competition from their advertiser tools or acquisitions like DoubleClick, they disagree with court's decision regarding their publisher tools.
She emphasized that publishers have many options and choose Google because its ad tech tools are simple, affordable, and effective.
Judge's argument
Google's practices harm competition, says Judge Brinkema
Despite Google's defense, Brinkema argued in her ruling that the company's practices have deprived "rivals of the ability to compete" and "substantially harmed Google's publisher customers, the competitive process, and, ultimately, consumers of information on the open web."
This could possibly force Google to divest part of its online ad business.
However, Professor William Kovacic from The George Washington University Law School suggested this outcome is less likely, as not all government claims were upheld.