Key takeaways from the ad tech trial


This week we finished making our case in the Department of Justice’s lawsuit about some of our advertising technology.

Here’s a recap of what we presented and the arguments we made during the trial as the presentation of evidence concluded:

The DOJ claimed Google doesn’t do enough to help competitors. In fact, we do a lot.

The DOJ wants to force Google to build tools that would let other companies, who don’t have our standards for safety and security, market to our customers and use our technology. And that’s despite the fact that we already go above and beyond legal requirements in making tools that others can use. As Neal Mohan, now CEO of YouTube, said: “Our strategy is straightforward. We want to grow the overall display advertising pie for everyone in the industry.”

Witnesses such as James Avery, founder and CEO of Kevel, and the DOJ’s own economic expert, Professor Robin Lee, confirmed that some competitors simply want Google to build more direct integrations from our tools to competitors’ tools. Others went a step further. Stephanie Layser, formerly of NewsCorp and now of Amazon, testified regarding Google’s ad tech tools that “the core software should be open source” and a “community asset.” But that “duty to deal” is not what American law requires, since no company would want to invest in complex platforms only to have them handed over to others.

The challenged practices benefited customers. And most have already been replaced by newer technologies.

Nobel-Prize-laureate auction economist Paul Milgrom testified that “every one of the conducts we’ve described — Google’s programs — benefited its own customers, either advertisers or publishers or both,” finding that “Google’s changes to its own auction were improvements at the time in which they occurred relative to what had come before.”

Trial testimony made clear that virtually all of the challenged practices haven’t been used for years. The DOJ’s own expert conceded that of the five alleged anticompetitive actions in the case, the “only one that’s in effect today is UPR [uniform pricing rules]” and we heard evidence that UPR had a positive impact on revenue for publishers and simplified bidding for advertisers.

The DOJ’s claims missed the two-sided market for matching buyers and sellers of digital ads, where Google’s integrated ad tech offerings are cheaper, safer and more effective for customers.

In his testimony, Index Exchange CEO Andrew Casale compared ad exchanges to a platform that facilitates transactions between credit card holders and merchants. In this two-sided market, we showed the Court that Google’s integrated ad tech stack offers services that are cheaper, safer, and more effective. Per Bjorke, Senior Product Manager for our Ad Traffic Quality team, showed how Google’s “end-to-end integration” offers safety benefits by letting us “much more effectively keep bad actors out.”

We also showed how Google’s ad tech fees are lower than reported industry averages. In fact, as Yale Professor Judith Chevalier explained, “using Google tools actually has a lower revenue share” when compared to competitors’ full stack average revenue shares, and it is on average “less expensive to use Google-to-Google than using third-party-to-third-party” tools to connect advertisers with publishers.

Google witnesses testified that ad buyers and sellers benefit from the integration of Google’s tools. As Neal Mohan put it: “Having a strong advertiser side benefited our publishers, and having a strong publisher side benefited our advertisers.”



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