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In a landmark decision, a federal judge ruled that Google illegally maintained a monopoly over some of its adtech business, a move that could force the tech giant to divest one of its most profitable divisions and upend the infrastructure underpinning much of the online ad industry.
Following a three-week bench trial, the court found that Google violated antitrust law by maintaining monopoly power in two critical areas: publisher ad servers and ad exchanges. Ad servers are used by publishers to manage their ad inventory, and ad exchanges helps publishers sell ad space through supply-side platforms—in this case, specifically through Google’s AdX product. The judge also found that Google unlawfully tied its ad server, formerly known as DoubleClick for Publishers (or DFP), with AdX in violation of antitrust laws.
“In addition to depriving rivals of the ability to compete, this exclusionary conduct substantially harmed Google’s publisher customers, the competitive process, and, ultimately, consumers of information on the open web,” wrote Judge Brinkema.
Andrew Casale, president and CEO of Index Exchange told ADWEEK: “The judge got it right and this ultimately marks a check on big tech.” Casale testified on opening day at the trial in Virginia, describing it as “one of the most intimidating experiences” of his life.
“This is going to usher in an era of a more competitive open Internet,” he added.
Google’s publisher tech is hit
Google’s advertiser-focused products were not found in violation. Brinkema dismissed the DOJ’s claims to establish a distinct market for advertiser’s ad networks. The ruling means Google has a monopoly on its sell-side tools but not on its buy-side tools.
Court documents also reveal that the judge found no valid security or quality justification for Google’s AdX-DFP tie.
Industry experts, including Casale and Jay Friedman, CEO of ad agency Goodway Group, testified that Google’s adtech was no more effective at preventing fraud, malware, or spam than other providers.
Per Casale, header bidding posed no greater risk of fraud or malware than bidding within Google’s adtech stack. Meanwhile, Friedman stated that all large ad exchanges provide “similar quality inventory to … any of the other ones.”
However, Brinkema stated that Google’s justification for the AdX-DFP tie was either “pretextual or, at best, incidental to the primary purpose of the tie, which was to acquire and maintain market power in the open-web ad exchange and publisher ad server markets.”
The ruling opens the door to remedies that could dramatically reshape how digital ads are bought and sold. Google holds a solid grip on 25.6% of the $303 billion U.S. digital ad market, according to eMarketer. Meta follows with 21.3%, and Amazon holds 13.9%.
While the court has not yet determined what structural changes—if any—will be imposed, the case stands as one of the most aggressive antitrust actions against a U.S. tech company in decades.
It also marks Google’s second major legal defeat in the past year, following a separate DOJ antitrust case targeting the company’s dominance in search. In that trial, the DOJ called for Google to divest its Chrome browser.
Next, Brinkema will determine appropriate remedies for the adtech antitrust trial, which could include forcing Google to divest all or part of its lucrative adtech stack that could have far reaching implications.
“We commend this ruling, and this is a good day for advertisers, publishers, the industry, and the public at large,” said Arielle Garcia, chief operating officer at industry watchdog Check My Ads.
In a statement, Google’s VP of regulatory affairs, Lee-Anne Mulholland, said the tech giant won half of the case.
“We won half of this case, and we will appeal the other half,” Mulholland wrote. “The Court found that our advertiser tools and our acquisitions, such as DoubleClick, don’t harm competition. We disagree with the Court’s decision regarding our publisher tools. Publishers have many options, and they choose Google because our adtech tools are simple, affordable and effective.”
Editor’s note: This story was updated after publication to include a statement from Google.
