Google is an illegal monopolist in online advertising, a federal court has determined, in a ruling that could lead to a breakup of its ad business.
On Thursday, U.S. District Judge Leonie Brinkema ruled that Google unlawfully monopolized advertising markets. The ruling determined that Google had control over a number of advertising markets, to the level of a monopoly, which it used to its advantage.
In the ruling, Judge Brinkema determined that Google's monopoly affected the market for publisher ad servers and for ad exchanges. In effect, Google was able to influence the way advertisers bought ads, as well as how much publishers sold that ad space for.
This was enough to influence and exert control over the overall online advertising market in general.
However, an attempt to show that Google monopolized advertiser ad networks failed, despite the Department of Justice's urging.
The ruling gives fuel to the possibility that Google will have to break apart its lucrative advertising business in some way. Following the ruling, the court will be seeking remedies from Google on how it can rectify the situation.
A big squeeze
The battle saw the U.S. government claim Google had used its size and influence on both the buyer and seller sides of the equation. In doing so, it was able to raise the prices of ad spots, while also reducing the ability for competitors to take Google on.
The ruling from Judge Brinkema determined Google deprived competitors of "the ability to compete," which substantially harmed Google's customers and consumers, as well as market competition.
As part of the ruling, the judge has ordered the lawsuit's parties to offer arguments and proposals for how Google's monopoly in ad tech can be eliminated. The Department of Justice has previously insisted that Google could break off the Google Ad Manager, selling it to another company at a minimum.
Oddly, this is a thing that Google had previously considered, having thought about it in 2019 and 2022. This occurred before the DOJ's suit was filed in 2023.
Twice the monopoly
This is not the first time Google has been referred to as an illegal monopoly by the court. In August 2024, a court agreed with the DOJ that Google had an illegal monopoly in the search market.
In that instance, Google was said to have a monopoly on the search engine market, and had performed actions to shut out competing search engines.
While Apple wasn't involved in the latest ad market case, it did have a role in the search engine market one.
In that instance, the court discussed how Google paid billions to firms to make it the most prominent or first choice for consumers. This included paying Apple $20 billion in 2022 to keep Google as the default search in Safari.
Break-ups and benefits
For Google, the result is making the prospect of a partial breaking up of the company more likely.
Under the first antitrust monopoly ruling, while Google proposed remedies such as altering existing contracts with Apple and others, the DoJ was more blunt in insisting there be a sale or break-up.
With the court asking for remedies once again, this will give the DOJ a second opportunity to recommend a breaking-up or a sale of a business arm.
A shifting of the ad business away from Google wouldn't be a death knell for the search giant. It wouldn't affect the ad sales on Google's properties, such as Gmail, Google Maps, or YouTube.
Indeed, any remedies that affect the ad business could be beneficial to Apple. The iPhone maker has been expanding its own advertising arm, and it could see an opportunity for growth if Google's forced into actions to improve competition.
This is pretty much the opposite result of the worst that could happen to Apple under the earlier monopoly lawsuit. Under that one, the remedies could affect the billions Apple receives from Google for Safari search preferences.
