A lawsuit filed by the US Department of Justice U.S against Google (GOOGL) on your domain market in technology for digital advertising could help rivals and sites that sell ad space, but it leaves an uncertain future for the next advertisers, experts say.
The Justice Department’s complaint against Google on Tuesday called for the company to sell Google Ad Manager, a set of tools that include one that allows websites to put up advertising space for sale and another that serves as an ad marketplace that automatically matches advertisers with these content publishers.
If the Justice Department’s lawsuit succeeds, “advertisers and publishers could benefit more from more options with expanding players — and therefore more competition,” said Neil Begley of Moody’s Investors Service.
Apple, which is steadily building up its nascent advertising business and promoting it as privacy-focused, could be a winner if Google’s ads become less effective, said Brian Mandelbaum, chief executive of marketing firm Attain.
Advertising industry executives say Google’s business, by placing ads on sites it does not own, provides Google with valuable information about an ad’s effectiveness.
Apple has “the ability to be a new dominant force” in advertising because Apple owns data through ownership of phones, the Safari browser and distribution of apps through the App Store, he said.
Google’s competitors in ad technology are increasingly creating products that cater to both publishers such as news sites selling ad space and advertisers buying ads, as Google currently does, said Paul Bannister, chief strategy officer at CafeMedia. , which helps small and medium-sized content companies that sell advertising space.
If Google is forced to divest tools that cater to publishers, it will benefit competitors like Microsoft’s Xandr, which will still work both sides of the ad-buying ecosystem, Bannister said.
With more options beyond Google, publishers will have more transparency about how much ad space they can sell and may end up paying less in fees, Mandelbaum said.
If successful, the lawsuit could be “the start of serious changes to Google’s business model,” said Paul Gallant, managing director of the Cowen Washington Research Group.
Assets that may have to be sold could result in the loss of important data that helps Google target ads to relevant consumers, he said.
If Google loses access to them, advertisers could see Google ads become less effective, said Nikhil Lai, senior analyst at research firm Forrester.
At least twice before, the US government has filed lawsuits against dominant companies with results that have varied widely.
A lawsuit that broke up the AT&T telecommunications conglomerate, opened in 1974, resulted in an agreement in 1982 to break up the company. This split has been credited with supporting a number of innovations in telephony.
The US Department of Justice lawsuit against Microsoft, filed in 1998, held the company back as it sought to extend its Windows operating system to Internet browsers.
Although the process ended with an agreement between the parties, experts say that it paved the way for other companies to establish themselves on the then nascent internet, such as Google itself.
Source: Moneytimes
I am an author and journalist with a focus on market news. I have worked for a global news website for the past two years, writing articles on a range of topics relating to the stock market. My work has been published in international publications and I have delivered talks at both academic institutions and business conferences around the world.
