US senators just gave Google a grilling over its ad dominance – and gave us a glimpse at what an upcoming antitrust lawsuit might hold (GOOGL)

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Following July’s historic antitrust hearing with the big four tech giants — Amazon, Google, Facebook, Apple – Google had the floor to itself on Tuesday, as US senators probed the company over its dominance in the digital ad market.

The hearing comes at a critical time. The New York Times recently reported that the Justice Department is preparing to file a case against Google as soon as this month, yet there remains a crucial question: What will the lawsuit actually involve?

Senators from both sides of the aisle gave us a few hints on Tuesday as they drilled into Google’s advertising business – a central focus of both the Justice Department’s investigation and a parallel investigation being run by a group of state attorneys general.

While Alphabet CEO Sundar Pichai took questions at last month’s antitrust hearing, Google this time sent its head of partnerships, Don Harrison, to play defence.

And with Google having the full spotlight this time around, there was opportunity to dig deeper into some of the points that lawmakers breezed through last month.

Despite some theatrics around accusations of Google’s political bias, senators were able to quiz Harrison on the company’s bewilderingly complex advertising stack — chiefly, how Google controls both the demand side (advertisers bidding on where to place their ads across the web) and the publisher side (websites deciding what ads appear on their site), and whether this has allowed Google to abuse its dominant position.

“I think the concern is that you control YouTube and Search, which are the dominant platforms. You control massive amounts of consumer data that you have harvested from your other consumer-facing platforms – Gmail, Google Maps, GSuite etc. You then use those advantages in the ad stack at every single layer, every layer of which you exercise dominance in,” Senator Josh Hawley told Harrison (R-Mo.).

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“This looks like monopoly upon monopoly, and a classic case of tying. We’ll see. We’re going to find out, I hope, as these antitrust investigations proceed.

It was a further hint that a case against Google could focus on how the company” bundles” its ad tech tools together.

Bloomberg recently reported that the Justice Department and state attorneys general had been questioning Google ad rivals over how Google uses discounts and other incentives to keep advertisers and publishers using its ad products, effectively “tying” them together.

Harrison continued to defend Google’s position throughout the hearing, arguing that the company has plenty of competition in the market. However, when Senator Marsha Blackburn (R-Tenn.) quizzed Harrison on ad competitors who control as much of the ad bidding process, he failed to offer examples.

“Is there any single competitor to Google’s online advertising business that offers services in every level of the ad stack?” asked Blackburn.

After a clarification, Harrison replied:” I think there are a few competitors that have tools that have both buy-side and sell-side tools as well as the tools that allow for the provisioning of advertising. I don’t want to say a name because I’m worried I’m going to get …read more

Source:: Business Insider


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