Google’s digital ads empire faces potential breakup as antitrust remedy trial kicks off

Google is once again facing the possibility of a forced breakup as closely-watched hearings on how to tackle its monopoly over digital advertising technology kicked off in Virginia federal court on Monday.

Justice Department attorney Julia Tarver Wood slammed Google’s proposal for a lighter penalty – comparing it to “[putting] a band-aid on a seriously severed limb” – and said a forced divestiture of its key ad exchange, AdX, was needed to restore fair competition and protect news publishers and advertisers that rely on the system.

“The means to cheat are buried in computer codes and algorithms,” said Wood, who also referred to Google as a “recidivist monopolist” during her opening statement.

US District Judge Leonie Brinkema will preside over two weeks of hearings. In April, she ruled that the Big Tech giant had violated the Sherman Act by dominating the online publisher ad server market, as well as the ad-exchange market that connects ad buyers to sellers.  

Google, led by CEO Sundar Pichai, has argued that the DOJ’s proposal risks breaking its advertising tech platform entirely, making it harder for advertisers and publishers to do business. Instead, the company has proposed making its tools easier to use and compatible with services offered by its rivals.

Karen Dunn, Google’s attorney, said the DOJ’s push for a forced sale was “radical and reckless.” She added that Google’s plan, if it is approved, would deliver a “workable, effective and enforceable” remedy within a year, Bloomberg reported.

Dunn, who argued during the initial trial that the DOJ misunderstood how Google’s ad technology works, said the company’s proposal was as extensive as it could be “without breaking the tech.”

It’s the latest development in an ongoing high-wire act for Google, which escaped significant penalties earlier this month in a separate case targeting its online search empire.

In that case, US District Judge Amit Mehta ruled that Google was a “monopolist,” but opted to merely require the company to share data with rivals rather than accept the DOJ’s proposal for a forced selloff of its Chrome web browser. Critics decried Mehta’s decision as a “slap on the wrist” that effectively allowed Google to continue operating its monopoly.

Dunn made multiple references to Mehta’s decision on Chrome while making the case against a breakup in the digital advertising trial.

Experts expected to testify during the remedy phase include a former executive from The Post’s parent company News Corp, as well as executives from the Daily Mail and media conglomerate Advance Local.

Regardless of the outcome of the remedy phase, Google has previously vowed to appeal Brinkema’s ruling that it operates two illegal monopolies in the digital advertising sector.

That appeal can’t begin until the remedy phase is complete. Brinkema will make the final decision. The case was originally brought in 2023 by the Biden administration’s Justice Department and a coalition of states.

With Post wires