Google told to break up its ads business, sell two key products as judge finds illegal monopoly

The US Department of Justice (DOJ) has proposed that Google divest two of its key advertising products, AdX and DoubleClick for Publishers (DFP), in a sweeping effort to restore competition in the digital advertising market. The proposal follows a federal court ruling that found the tech giant guilty of “willfully acquiring and maintaining monopoly power” in two critical ad tech markets.

As reported by Reuters, US District Judge Leonie Brinkema ruled last month that Google had illegally dominated both the ad exchange and publisher ad server markets. In a subsequent court filing reviewed by Reuters and TechCrunch, the DOJ argued that structural remedies, including divestitures, are necessary to “terminate Google’s monopolies” and prevent future anticompetitive conduct.

The DOJ is calling for the full divestiture of AdX, Google’s digital ad marketplace, and a phased sale of DFP, its platform used by publishers to manage and deliver ads. Additionally, the department wants Google to be barred from operating an ad exchange for 10 years following the sale of AdX. The DOJ also alleges that Google integrated AdX with DFP to ensure publishers would lose “significant revenue” if they did not use both tools, effectively locking out competition.

According to the DOJ filing cited by TechCrunch, the agency also directed Google to open its ad-buying tools, including AdWords, to work with all third-party ad tech platforms “on non-discriminatory terms” for bidding, placement, and access to data, unless otherwise specified by an advertiser.

In response, Google has pushed back forcefully. “The DOJ’s additional proposals to force a divestiture of our ad tech tools go well beyond the Court’s findings, have no basis in law, and would harm publishers and advertisers,” said Lee-Anne Mulholland, Google’s Vice President of Regulatory Affairs, in a statement to Reuters. She added that Google’s own proposed remedies, including opening AdX to third-party ad servers and appointing an independent compliance observer, adequately address the court’s liability ruling.

While the DOJ dismissed these behavioural remedies as insufficient, Mulholland claimed the department had already acknowledged Google’s proposals met the legal threshold based on the court’s decision.

Meanwhile, in Europe, Google previously attempted to settle an antitrust investigation by offering to sell AdX, as Reuters noted, but the proposal was rejected by publishers as insufficient.

A trial to determine the final remedies in the DOJ’s ad tech case is scheduled to begin in September, after Judge Brinkema heard arguments from both sides last week.