US Justice Department sued Google again. It aims to demolish its ad department //
The U.S. Justice Department just filed its second antitrust suit against Google. This indicates that the government will continue to pursue cases against tech companies. This lawsuit is the first filed under the Biden Administration and aims to force Google to divest some of its online advertising business.
In October 2020, the Trump Administration filed a previous lawsuit against Google alleging that it used its monopoly power to suppress competition in internet search by entering into exclusionary agreements. The case is scheduled to proceed to trial in September.
Google is also facing additional antitrust suits from a number of state attorneys general. This includes one that concerns Google’s advertising business, led by Texas Attorney General Ken Paxton. California, Connecticut, New Jersey and New York, Rhode Island (Tennessee), Virginia, and Connecticut joined the DOJ in this suit. Google’s advertising business has been criticised for its market positioning. It operates on multiple markets, giving it unique insight into the market and leverage. Google claims it does not dominate the online advertising market, and points out the market share of Facebook and other competitors.
It’s not new. Google proposed in July to separate the auctions and ads placed on websites and apps by its part of the business into a separate Alphabet company to avoid a lawsuit from US Department of Justice.
The Justice Department did not comment on the offer and it was unclear whether they would accept less than an asset sales. In the European Union, the company was also subject to an ad tech investigation. They offered to let competitors broker the sale ads directly on YouTube.
Google is too big to fail. Google is too big to fail. Unclear. It is not clear. Google is an influential and large company. However, it’s unclear if Google would be considered “too big for failure.”
Although the company has significant revenue and market share, there are many companies and competitors that are also gaining market share. Google is not a financial institution so it doesn’t pose the same risks as a bank, or insurance company.
However, it is one of the largest companies in the world. It has a large range of products and services that people use every day and has a tremendous impact on the economy.
It’s a good time to be competitive. There are many reasons why competition in the advertising industry is considered a positive thing.
- Innovation
- Lower prices
- Higher Quality
- Consumer Choice
- Fairness
This lawsuit shows that there could be new competition just in the right time. It will allow for more platforms to emerge and grab market share.
Microsoft has greatly improved its ad platform over the past few years. They have pledged to double the size of their ad platform, to $20 billion, in order to compete with Google.
Microsoft Ads was formerly known as Bing Ads. It has a large market share and offers many of the same features and capabilities that Google. Microsoft Ads is one of the biggest competitors.
- Reach: Microsoft Ads has an audience of over 500 million people worldwide and a reach of approximately 157 million in the US.
- Demographics: Microsoft Ads is more targeted at a specific demographic than Google Ads. This means it can be an effective way to reach a new audience.
- Cost: Microsoft Ads have a lower cost per click than Google Ads. This can be a benefit for advertisers with tight budgets.
- Integration: Microsoft Ads can be integrated with other Microsoft products like Skype, Xbox, and LinkedIn. This gives advertisers unique targeting possibilities.
- Performance: Microsoft Ads is reported to have higher conversion rates and better targeting capabilities than Google Ads.
Diversity. Diversity is not just for the workplace. Advertising platforms should be diverse to keep your company from being spotted by the DOJ. For advertisers, it may also reduce your exposure.
As with stocks, ensuring that your ads are seen on a variety of platforms will ensure that they will be seen by more people. It will also help you to protect yourself against lawsuits, algorithm changes and competition from new-to-market platforms. Search Engine Land’s SMX Next is an excellent resource for discovering these emerging ad platforms.
TikTok, and other emerging platforms. Google and Facebook’s share of the advertising market fell below 50% in 2022 for the first time since 2014. It was 48.4%. It is predicted that it will fall to 44.9% by 2023. This is due to increasing influence of other digital platforms like Amazon, TikTok and streaming services such as Netflix. People are spending less time on Google or Facebook.
The iOS14 update in 2021 required apps to ask users whether they want to be tracked. However, Google was not affected because it relies upon search terms to determine customer intent.
TikTok’s share of the digital advertising market nearly doubled in 2022. Amazon, however, gained market share because its ad company was able to target users based on their browsing history and purchases. Amazon was responsible for 11.7% US digital advertising spending in 2017 and this figure is expected to rise to 12.4% by 2023. Other retailers such as Walmart, Etsy and Instacart have digital advertising businesses that are based upon consumer data. They took 1.4% of all digital ad dollars in the US last fiscal year.
Layoffs, reselling and dashboard outages. Google has had a difficult week. Yesterday’s outage resulted in the Ads dashboard, along with many other tools such as Editor and Search 360, being unavailable to most users. Although this is the first such outage of the year, 2022 saw multiple problems that caused advertisers to become frustrated with the platform.
Last week, Google announced plans to lay off 12,000 workers or 6% of its workforce. After that announcement they confirmed a strategy to reduce expenses by using its network of approved resellers for advertising services, which positions the company as a software-as-a-service (SaaS) provider, making it more appealing to investors.
Why do we care? The DOJ could win the lawsuits and make significant changes in the online advertising market. This could have a major impact on how advertisers reach their audience and allocate their ad funds.
The threat of lawsuits could also limit innovation and prevent the development and release of new features, products, and technologies that could be beneficial to advertisers. This is not just for Google but all other ad platforms.
Google may also have to sell off parts of its advertising business. This could lead to increased costs for advertisers as they will either have to pay more or use more expensive platforms to reach their audiences.
Advertisers should be concerned. Most likely not. Not at least not yet. Google and other tech companies have been subject to regulatory scrutiny and legal challenges in the past for their advertising practices. There is always the possibility of new lawsuits being filed in the future. However, it’s impossible to predict what the latest troubles will bring. It is also difficult to know if advertisers should be concerned at the moment.
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