Google Loses Second Monopoly Case, Must Restructure Ad Business

Judge Leonie Brinkema found Google deliberately strangled competition in the systems that place ads across the internet. Her 115-page ruling cited Google's "willful" monopoly over both the tools websites use to sell ads and the exchanges where ad deals happen.

For publishers struggling under Google's 87% market share in ad tech, the ruling offers hope. News organizations might finally get better deals if Google must sell its ad platform.

Google's grip on digital ads started with its $3.1 billion DoubleClick purchase in 2008. That deal created what the judge called a "self-reinforcing feedback loop" - more advertisers attracted more publishers, driving even more advertisers to Google's platform.

The company's defense fell flat. Google claimed it faced fierce competition from TikTok and streaming services. It argued its ad products work better together, much like Microsoft once defended bundling Internet Explorer with Windows. The judge didn't buy it.

This ruling hits Google at a precarious time. Next week, another court weighs whether to break up Google's search business after finding it monopolistic last August. The Justice Department also wants Google to sell Chrome.

For Google parent Alphabet, the stakes are enormous. While ad tech provides just 10% of revenue, it connects crucial parts of Google's empire. A forced breakup could trigger wider changes across the $1.88 trillion company.

Shares dropped 3.2% on the news before settling at $151.18, down 1.4%.

Jonathan Kanter, the Justice Department's antitrust chief, called the ruling "a huge victory for antitrust enforcement, the media industry, and the free and open internet."

Google quickly pushed back. "We won half of this case and we will appeal the other half," said Lee-Anne Mulholland, Vice President of Regulatory Affairs. "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 ad tech tools are simple, affordable and effective."

Why this matters:

• Courts finally show real muscle against Big Tech monopolies. After years of acquisitions and market dominance, Silicon Valley's empire-builders face actual consequences.
• Google's ad tech spinoff could redirect billions in advertising dollars. Publishers might get better deals - assuming they don't blow it all on office ping pong tables.

Read on, my dear:

• Washington Post: Google holds an illegal monopoly in ad sales, court rules