Marketers on high alert with DOJ ‘out for Google’s blood,’ experts say
The US Department of Justice (DOJ) alongside eight states brought a new lawsuit against Google, accusing the tech titan of illegally operating a monopoly of the technology backing the digital advertising economy…
Of course, not everyone shares the same positive outlook. Josh Withrow, a fellow of tech and innovation policy at the R Street Institute, a free markets-focused think tank based in Washington, D.C., argues that breaking up Google’s ad business will only reduce the seamlessness and efficiency of the current digital advertising ecosystem. “A vertically-integrated system like Google’s adtech stack generally creates efficiencies that lower costs. Forcing costs higher on Google’s platform by breaking it up may benefit its competitors, but it’s difficult to see how this advances consumer welfare,” he says.
“By seeking to break up Google’s ad stack wholesale, the DOJ is making the mistake of substituting a hypothetically better alternate history of digital ad markets for the generally well-functioning, competitive one that exists now. That shouldn’t be the role of antitrust enforcement.” In essence, Withrow’s point is: why try to fix what’s not broken?
But will the DOJ win the case?
Of course, for now, nothing is a sure bet, as the outcome of the lawsuit is not yet clear. And predictions vary wildly.
Withrow, whose research at the R Street Institute largely focuses on regulation and antitrust efforts in the tech sector, is confident that Google won’t take a real tumble any time soon. “The DOJ is filing this case just as the biggest story in digital marketing has become how quickly rivals like Amazon, Netflix and TikTok are eating into Google’s ad market share.”
In essence, he argues, Google isn’t eating up more of the marketplace right now – it’s losing share. And he’s right: reports from earlier this month indicate that, for the first time in almost a decade, Google and Meta are no longer capturing the majority of digital ad spend in the US. For this reason, Withrow says, “The government’s overarching argument that Google wields monopoly power in the digital ad industry ought to be a hard sell in court…”