U.S. v. Google: What Each Side Argued for Fixing Google’s Ad Tech Monopoly

For two weeks, the Justice Department and Google have questioned more than two dozen witnesses to try to sway a federal judge’s decision over how to address the company’s illegal monopoly in advertising software.

On Monday, that hearing concluded in the U.S. District Court for the Eastern District of Virginia. To fix the monopoly, the government proposed aggressive measures that include forcing Google to sell its system that connects buyers and sellers of advertising space. Google argued that smaller changes to its business practices would be more appropriate.

Both sides will offer closing arguments in November. Judge Leonie M. Brinkema, who is presiding over the case, is expected to reach a decision in the coming months. Her ruling could have significant implications for Google’s business.

Here’s what to know about what each side argued at the hearing.

What case does the hearing stem from?

In April, Judge Brinkema ruled that Google had broken antitrust law to build its dominance over the largely invisible system of technology that places advertisements on pages across the web.

The Justice Department argued that Google had a monopoly over three parts of the online advertising market: the tools used by online publishers, like news sites, to host open ad space; the tools advertisers use to buy that ad space; and the software that enables those transactions.

Judge Brinkema ruled in the government’s favor in two of those, finding that Google illegally built a monopoly over the publisher tools and the transaction software system. She dismissed the third, the tools used by advertisers.

The judge convened the hearing last month to determine how to best address the company’s monopoly through measures called remedies. Executives from Google, publishers and rival ad tech companies — alongside experts in economics and computer science — testified about the tech giant’s power.

What did the government argue?

The only way to end Google’s dominance in ad tech is by forcing a breakup, government lawyers said.

The Justice Department argued that Google should sell the software that connects the buyers and sellers of ad space, known as an ad exchange. The company should make public the code that its publisher tools use to run auctions for ad space, and sell the remaining parts of those tools if competition does not improve, the lawyers added.

“Nothing short of a structural divestment is sufficient to bring meaningful change,” Julia Tarver Wood, the Justice Department’s lead litigator, said during opening statements.

One of the government’s experts, a former Google and Facebook engineer named Goranka Bjedov, testified that it was possible for Google to transfer control of the ad exchange to a new owner. When Facebook bought Instagram in 2012, Dr. Goranka was involved in helping to integrate Instagram’s data into its new parent company’s systems.

Though it would be complicated, she estimated that another company could buy and integrate Google’s ad exchange technology and data, too.

“A reasonably competent team of 80 engineers can get this done,” she said.

What did Google argue?

Google’s lawyers said the government’s proposal was too complicated to pull off without harming publishers who use its automated systems to sell ads — particularly small firms that rely on the company’s technology to conduct business.

Elizabeth Douglas, the chief executive of the how-to site wikiHow, testified that she feared a Google breakup would further disrupt her business. Already, traffic to her site has dropped as people increasingly turn to artificial intelligence for information, including Google’s A.I.-generated answers in search.

“I’m here today because I’m worried for my business,” she said.

Google witnesses said that its ad tech products were too tied up with its companywide internal systems to be easily spun off. Glenn Berntson, a Google engineering director, testified that it would be challenging for any company to buy and incorporate the company’s ad exchange given its scale and complexity. The system, he said, receives 8.2 million requests to sell ad space every second.

Divesting aspects of Google’s ad technology is “more complex than anything I’ve done in the 10 years at Google,” he said.

Google’s lawyers instead proposed that the company make its systems work better with products produced by its competitors. Google would also change policies to make it easier for publishers to use rivals’ tools in combination with its own, the lawyers said.

What did other companies say?

During the hearing, several Google competitors, including the ad tech companies PubMatic and Equativ, said they supported the government’s proposal.

PubMatic’s chief executive, Rajeev Goel, said it would be impossible for the court to predict and stop every way that Google could continue its dominance. A breakup of the company’s ad tech empire was the best way to do so, he added.

What did the judge say?

Judge Brinkema had already indicated during a hearing in May that she was considering a breakup, asking whether forcing Google to sell its ad exchange would resolve its monopoly.

This week, she questioned whether it would be sufficient to simply set rules governing Google’s behavior. Any rules put in place by the court would be enshrined in a court order, a threat hanging over Google’s head, she said. She pressed Mr. Goel, the rival ad tech executive, on whether that would help.

Google would probably follow a court order, he said. But it would be difficult for the court to anticipate every way that the company might find to get around it, he added.

As the proceedings came to a close on Monday, Judge Brinkema suggested the two sides could consider settling.