Google Experiences Another Significant Antitrust Setback, With Additional Legal Challenges Looming

Google has encountered yet another notable defeat in court concerning antitrust infringements, contributing to a rising roster of legal difficulties the technology behemoth is encountering worldwide. This recent blow occurs only weeks prior to the commencement of another significant antitrust trial. Concurrently, Japan’s Fair Trade Commission has implemented a cease-and-desist directive against the corporation, and earlier this year, the European Union ratified a major antitrust penalty imposed on Google.

On Thursday, U.S. District Judge Leonie Brinkema determined that Google had breached antitrust regulations by unlawfully monopolizing the online advertising technology sector. The case, initiated by the U.S. Department of Justice (DOJ) along with 17 states, charged Google with employing anticompetitive strategies to control the ad tech market. In 2023 alone, Google amassed $237.9 billion in advertising earnings—far exceeding competitors like Microsoft and Baidu.

The court established that “Plaintiffs have demonstrated that Google has deliberately engaged in a series of anticompetitive activities to obtain and sustain monopoly power in the publisher ad server and ad exchange markets for open-web display advertising.”

In light of the ruling, the DOJ is anticipated to advocate for Google to spin off its Google Ad Manager division, which encompasses both its publisher ad server and ad exchange. The DOJ had previously suggested this direction even prior to the court’s verdict.

Throughout the three-week trial, the DOJ contended that Google upheld its dominance by acquiring rivals and compelling publishers and advertisers into its ecosystem. In its defense, Google asserted that it provided a more economical option compared to higher-priced alternatives.

While Google Ad Manager constitutes approximately 12% of Alphabet’s business, the bulk of the company’s advertising income is derived from its own platforms, such as Google Search and YouTube. Consequently, separating this segment of the business may not notably affect the company’s overall financial health. Indeed, Google had previously contemplated divesting portions of its ad tech operations in response to EU regulations, as reported by Reuters in 2023.

This represents the second major antitrust defeat for Google within a year. In August 2024, another federal judge determined that Google violated antitrust laws through its agreement with Apple, which involved compensating the iPhone manufacturer $20 billion per year to designate Google Search as the default selection on iOS devices.

A separate trial scheduled for later this month will ascertain the measures Google must take following that ruling. The DOJ has recommended that Google be mandated to divest its Chrome web browser. Should that remedy be considered inadequate, the DOJ may also insist that the company sell its Android mobile operating system.

With intensifying legal scrutiny from various governments and regulatory authorities, Google’s supremacy in crucial markets is increasingly at risk.