Google spent the past week in a Virginia federal court arguing against the Justice Department’s push to force the sale of its advertising exchange. The company contends that such a move would be too risky, technically complex, and could destabilize the market.
Over five days of testimony, witnesses backing the tech firm warned that a divestiture could jeopardize operations expected to generate $15.9 billion in revenue by 2025, based on projections from research firm eMarketer.
They further argued that dismantling the company’s ad exchange would sow uncertainty across the digital advertising industry, diminish service quality for smaller publishers, and deter potential investors.
Google finds itself in a problem with illegal monopoly allegations
Google’s trial process focuses on suitable methods to foster competition in the technology that supports the display advertising industry, which the tech giant controls.
The trial came after Leonie Brinkema, an American lawyer and jurist serving as a United States district judge of the US District Court for the Eastern District of Virginia, ruled that the tech company held an illegal monopoly in two areas, that is, the advertising exchange and ad server, a publisher-side technology, in April.
The tech firm currently sells ads for website publishers, provides tools for advertisers to buy placements, and runs an exchange where transactions are completed through real-time auctions.
In response to the ruling, the Justice Department has proposed that the tech firm be forced to divest its AdX exchange and disclose how its ad server determines which ads are displayed.
Notably, if these changes fail to fix competition issues encountered in the market, the department has requested that the company gradually sell its ad server.
In response to these proposals, Google has suggested integrating its technology with a popular alternative, Prebid, and competing ad servers. It has also pledged not to reinstate certain auction methods that the court found gave them unfair benefits, known as “first look” and “last look.”
However, it is worth noting that the company’s efforts mainly focused on fighting against the Justice Department’s proposal to make it sell AdX. On the other hand, the agency argued that they found this proposal appealing because it will control approximately 56% of the display ads market, supporting a significant portion of the open web.
Google fights against the Justice Department’s proposal to make it sell AdX
Concerning the sales of its ad exchange, Google outlined several arguments to convince the court that the Justice Department’s proposal was not a suitable solution. According to the tech company, selling AdX is technically tricky. This is because many of its engineers and outside experts agree that the ad exchange, unlike the rest of Google’s technology, would be complex.
AdX and the publisher ad server are now integrated into a single product under Google Ad Manager. Glenn Berntson, engineering director for Google Ad Manager, stated that this allows them to share processing power and reduces the time it takes to decide which ad to load on a webpage.
Heather Adkins, Google’s vice president of security engineering, commented on the situation. Adkins likened the relationship between AdX and Google’s core infrastructure to knitting, explaining that it is very intertwined.
Still, the Justice Department argues that the connection of Google’s AdX product to its underlying infrastructure could be replaced with tools from cloud providers, including the tech firm’s own offering, Google Cloud Platform.
Although Adkins acknowledged that some of Google’s core services have similar versions, they may not operate in exactly the same way.
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Source: https://www.cryptopolitan.com/google-fights-dojs-push-to-sell-ad-exchange/
