Advertising Week Briefing: Some worry the DOJ is ‘fighting yesterday’s war’ in ad tech antitrust case
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Earlier this week, the Justice Department outlined its proposed remedy framework to rein in Google’s search market dominance.
Potential outcomes include the search giant’s breakup, the prohibition of sweetheart deals with device manufacturers, and adjustments to its search advertising operations.
Still, on the conference stage and sidelines of Advertising Week, New York, attendees busied themselves with thoughts of the more recent antitrust trial; for some, the ad tech landscape will prove a more messy affair.
However, echoing sentiments expressed in a September Digiday Research survey, some were torn about whether a divestiture of Google’s sell-side ad tech would change anything.
From a conference session entitled “The ad tech shake-up: what does the Google antitrust trial mean for marketers?” panelists — all of whom preferred Judge Brinkema to rule against Google in her pending judgment — struck a note of caution.
The forced spin-off of Google’s sell-side ad tech business — the DOJ’s stated aim in the case — could prove moot. At the same time, other conference attendees wondered if breaking up Google could do more harm than good to an industry that is highly reliant on a single entity.
Industry investor and consultant Will Luttrell described Google as a single entity controlling the entire online advertising supply chain and recounted how investors have historically been shy about writing checks for startups that proposed competing with Google.
“You have no way to compete with them,” he added, “they’re going to figure out ways to do things that are in their best interest and against yours.”
Fellow panelist Justin Choi, CEO of Nativo, echoed Luttrell’s sentiment that Big Tech players have the finest engineers in the industry and hinted that staffers there have priced in any potential divestiture scenario.
“I think the DOJ is now fighting yesterday’s war. No matter what the result is, the damage is done, and by the time they have the remedy, the environment is going to be so different,” he said. “I think the only thing that would have a real serious impact would be, like, a $100 billion fine.”
In the same conversation, Matt Wasserlauf, CEO of Blockboard, advocated a “severe enough [financial] penalty” to make Google and other Big Tech players take complaints of anti-competitive, not to mention opaque, practices seriously.
Separately, in a Digiday Research survey conducted during the first week of October, readers were evenly split on whether it would be harder to monetize if the DOJ gets its way. Precisely half said it would be easier, the same number disagreed.
A decade to recover
Additional comments in the survey help illustrate the breadth of opinion on the consequences (and potential) of what a broken-up Google would entail.
One response noted how it would “take a decade to recover” from the existing status quo, but that short-term hardships would ultimately pay off.
“Initially, it will be harder for publishers and smaller ad tech companies to monetize, and a ton of them will go out of business, but after we get through the withdrawal (a few years probably), it will allow for a healthy ecosystem. But 5 years before Google is broken up and, then, another three-plus years to get rid of the shakes.”
Meanwhile, a separate respondent noted, “Separate [Google Ad Manager] GAM from [its ad server] AdX. Give capacity to move AdX auctions client-side and make them transparent. Make GAM open source in the same way they do Chrome through Chromium, and allow us to develop our own features in GAM.”
Google has voiced its intention to appeal the August ruling against its search operations, while closing arguments in its more recent antitrust case are scheduled for the week commencing November 25th.
Coming up:
9:30 a.m. Great Minds 20th Anniversary All Stars at Great Minds Stage
10:00 a.m. Deepfakes, TikTok and Political Ads: Media Influence Over the Upcoming Election at Insights Stage
10:50 a.m. CTV Advertising Trends for the 2024 Election at Insights Stage
11 a.m. Post Election 2024: How Brands Can Combat the DEI Backlash & Commit to Diversity at Innovation Stage
12:10 p.m. How Advertisers Can Thrive in the Next Era of Online Privacy at Insights Stage
1 p.m. Casting a Vision: Reimagining Advertising Through the Hollywood Lens at Great Minds Stage
1:30 p.m. News as a Brand Builder: The Power of Quality Journalism at Great Minds Stage
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