The ongoing antitrust trial against Google has revealed internal communications from the tech giant that shed light on its efforts to maintain dominance in the digital advertising industry through exclusivity deals and tying together its ad-tech businesses. On day seven of the trial, Marketing Brew reports that the release of a tranche of internal communications showed Google employees discussing their awareness of AdX’s heavy reliance on exclusive access to Google’s advertisers for maintaining its dominance in the market. This raises concerns about the importance of advertiser exclusivity in Google’s strategy to maintain its market position and indicates that crushing competition was vitally important to Google executives.
Further evidence presented in court showed that Google’s own buy-side tools were seen as weaker because they were exclusive to AdX. An internal company conversation revealed that Google employees suggested the company’s buy side was “subsidizing” the sell side, which “greatly weakens GDN’s position in the market.” The extent of Google’s reliance on its exclusivity deals was highlighted in a 2014 internal simulation, which showed that the company’s revenue would fall by 70 percent if Google’s ad network didn’t bid on AdX inventory.
Publishers, in an attempt to circumvent Google’s dominance, turned to header bidding, an open-source technology that allows publishers to access multiple ad exchanges. The DOJ had earlier revealed that Google executive Chris LaSala considered header bidding an “existential threat” in a 2016 email. Google allegedly considered a proposal to “starve” publishers that adopted header bidding technology, although the proposal never went into effect. The company also contemplated building a firewall between its buy and sell-side businesses to “legitimize AdX as a platform,” but Nirmal Jayaram, a senior director of engineering at Google, testified that he wasn’t aware of any formal firewall being implemented.
As the trial continues, the DOJ aims to prove that Google’s exclusivity deals and the tying of its ad-tech businesses together constitute anticompetitive practices that have allowed the company to maintain its dominant position in the digital advertising industry. The internal documents presented in court provide a glimpse into Google’s strategies and the concerns raised by its own employees regarding the company’s market power.