WASHINGTON, DC - JANUARY 24: U.S. Attorney General Merrick Garland is joined by Assistant Attorney ... [ ] General Jonathan Kanter of the Antitrust Division (L) and U.S. Associate Attorney General Vanita Gupta (R) as he speaks during a news conference at the Justice Department to announce a new antitrust lawsuit against Google on January 24, 2023 in Washington, DC. The Justice Department and states including California, New York, Colorado and Virginia, have filed a lawsuit against Google over the company's monopolization of the market for online ads. (Photo by Anna Moneymaker/Getty Images)
Google faces another antitrust trial that now aims to determine whether the search giant's advertising technology business violates the law. The Virginia bench trial — meaning a judge, rather than a jury, will issue a decision — will rule on two questions:
A guilty verdict could well follow. How so? The judge — Leonie Brinkema — may find Google has a monopoly in some segments of the ad tech industry. Moreover, she may agree with the plaintiff’s argument that Google engaged in anti-competitive behavior to achieve and sustain that monopoly.
If Google is found guilty, the punishment — which might involve divesting one of Google’s ad tech businesses — could slow down the company’s growth.
To be fair, a Wall Street analyst estimated such a divestiture would not meaningfully change Google’s revenue. Moreover, Google is likely to appeal a guilty verdict, which could delay this outcome.
However, should the penalty for a guilty verdict subtract meaningfully from the search giant’s revenue, Google’s shares — which already are trading roughly 21% below their all-time high reached in early June 2024 — could go down further.
I contacted Google for comment and will update this post if I receive a response.
In its response to the lawsuit, Google criticized the DOJ and states for using antitrust law to undo acquisitions previously approved by federal regulators.
Moreover, Google asserts in its defense, that advertisers and publishers choose the company’s ad tech products “because of their quality and Google’s commitment to constant innovation and improvement, not because they have no other choices or are forced to do so,” noted the company’s court filing.
The outcome of........