Tech Yourself Before You Wreck Yourself, Con't

The antitrust legal troubles for Google continue with another massive federal lawsuit over the company's monopoly on digital ads, and a recommendation from the Justice Department that the company be broken up.

 

The Justice Department and a group of states sued Google on Tuesday, accusing it of illegally abusing a monopoly over the technology that powers online advertising, in the agency’s first antitrust lawsuit against a tech giant under President Biden and an escalation in legal pressure on one of the world’s biggest internet companies.

The lawsuit said Google had “corrupted legitimate competition in the ad tech industry by engaging in a systematic campaign to seize control of the wide swath of high-tech tools used by publishers, advertisers and brokers, to facilitate digital advertising.” The lawsuit asked the U.S. District Court for the Eastern District of Virginia to force Google to sell its suite of ad technology products and stop the company from engaging in allegedly anticompetitive practices.

It was the fifth antitrust lawsuit filed by U.S. officials against Google since 2020, as lawmakers and regulators around the world try to rein in the power that big tech companies exert over information and commerce online. In Europe, Amazon, Google, Apple and others have faced antitrust investigations and charges, while regulators have passed new laws to limit social media’s harms and some practices such as data collection.

In the United States, Meta, the parent company of Facebook and Instagram, was sued in 2020 over claims that it illegally crushed nascent rivals. Google has faced particular scrutiny. In 2020, a group of states led by Texas filed an antitrust lawsuit against it involving advertising technology, while the Justice Department and another group of states separately sued Google over claims that it abused its dominance over online search. In 2021, some states also sued over Google’s app store practices.

The Justice Department and Google didn’t immediately respond to requests for comment.

The Biden administration is trying to use uncommon legal theories to clip the wings of some of America’s largest businesses. The Federal Trade Commission has asked a judge to block Meta from buying a virtual-reality start-up, a rare case that argues a deal could harm potential competition in a nascent market. The agency has also challenged Microsoft’s $69 billion purchase of the video game publisher Activision Blizzard, a notable action because the two companies are not primarily seen as direct competitors. 

 

It's definitely not helping Google's case when it does things like "Make $13 billion in profits in 2022" and then "Lay off 10,000 employees" because $13 billion in profits is apparently not enough. 

Still, it's going to be difficult to win this case.

The administration’s efforts are expected to meet fierce resistance in federal courts. Judges have for decades subscribed to a view that antitrust violations should mostly be determined by whether they increase prices for consumers. But Jonathan Kanter, the chief of the Justice Department’s antitrust division, and Lina Khan, the F.T.C. chair, have said they are willing to lose cases that allow them to stretch the boundaries of the law and that put corporate America on notice.

 

So, don't expect much here from this particular case. Google is still going to control nearly all digital advertising in the US and will for the foreseeable future.