Google’s dominance is taking care of… the market

Google's dominance is taking care of... the market
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The US Government’s lawsuit for advertising monopoly comes very late, but it has been falling for years

Google’s advertising machine is in trouble. US federal regulators allege in a lawsuit filed Tuesday that the Alphabet-owned search giant is monopolizing aspects of the digital advertising ecosystem. Your domain key? A series of past acquisitions that the government failed to stop when given the chance. For regulators, the only consolation for that missed opportunity is that the market is doing the work itself.

The Justice Department claims that the company led by Sundar Pichai is too domineering and opaque. It argues that it used “anti-competitive, exclusionary and illegal means to eliminate or seriously diminish any threat to its dominance over digital advertising technologies.” Google said in a statement that the lawsuit “attempts to pick winners and losers in the highly competitive ad technology industry.”

The problem is Google’s automated advertising network, which helps publishers and marketers place ads on websites where the right kind of customer will see them. Regulators argue that Google controls all aspects of that chain and plays its cards in such a way that publishers charge less, while advertisers pay more. It’s as if Goldman Sachs owns the New York Stock Exchange, the dossier states at one point, citing an anonymous Google executive.

Google gained its position in the market thanks to several operations, beginning with the acquisition in 2007 of the DoubleClick advertising platform, for 3.100 million dollars. The purchase was large enough to draw the attention of the Federal Trade Commission (FTC), which investigated the transaction but declined to question Google, concluding that it was easy for customers to switch networks. advertising.

A commissioner dissented, warning that the combination would turn Google into a “super middleman.” 15 years later, the litigants have come to share his view. They want Alphabet, valued at $1.3 trillion, to divest DoubleClick and another $400 million purchase in 2011, AdMeld.

It’s too, too late. Google’s dominance has been falling for years. Its share of the US digital advertising market peaked at 37% in 2015, according to Insider Intelligence. This year it is expected to fall another 10 percentage points. There are other ways to reach consumers, such as Facebook and Instagram, from Meta Platforms. Also, Amazon, TikTok and others are eating ground at Google. Regulators didn’t derail Google’s prospects back in the day, and they won’t be the ones to do so now.

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Brian Adam
Professional Blogger, V logger, traveler and explorer of new horizons.