Google’s lawyers wrapped up their arguments in the case on Friday, and the government will now offer a rebuttal. Judge Leonie Brinkema of the US District Court for the Eastern District of Virginia, who is presiding over the nonjury trial, is expected to deliver a ruling by the end of the year, after both sides summarize their cases in writing and deliver closing arguments.
The government last week concluded its main arguments in the case, US et al. v. Google, which was filed last year and accuses Google of building a monopoly over the technology that places ads on websites around the internet.
The company’s defense has centered on how its actions were justified and how it helped publishers, advertisers and competition. Here are Google’s main arguments.
How Google claims its actions were justified
The Justice Department and a group of states have accused the tech company of abusing control of its ad technology and violating antitrust law, in part through its 2008 acquisition of the advertising software company DoubleClick. Google has pushed up ad prices and harmed publishers by taking a big cut of each sale, the government argued.
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But Google’s lawyers countered that the ad tech industry was intensely competitive. They also accused the Justice Department of ignoring rivals such as Facebook, Microsoft and Amazon to make its case sound more compelling. At the heart of the suit is the internet giant’s suite of ad tools, which websites around the world use to sell ads on their sites. The technology conducts split-second auctions to place ads each time a user loads a page.
Google’s lawyers called experts to make the company’s case. Paul Milgrom, a Nobel Prize-winning professor of economics at Stanford University, testified that Google’s actions between 2013 and 2019 were not anticompetitive.
Google’s lawyers also called Judith Chevalier, a Yale University professor of economics, to contend that the company’s pricing was justified.
On its marketplace where businesses buy and sell ads, Google takes about 20% of transactions as a fee, Chevalier said. That is only slightly higher than a roughly 16% industry average calculated by one of the Justice Department’s expert witnesses, she said.
Chevalier compared these “take rates” in the US ad market, where ad exchanges charge more than elsewhere in the world. She added that a number of exchanges, whose names were redacted, charged more than Google did.
In cross-examination, Justice Department lawyers countered that even by Chevalier’s math, Google overcharged customers.
How Google says it helped people and fostered competition
The company’s lawyers argued that Google’s products brought more transparency to buying and selling ads and made publishers more money.
Nitish Korula, a former Google Ads engineering leader, testified that the company was not designing tools to dominate the industry, but was responding to dynamic competitors and catering to the desires of publishers.
“A large part of what Google does is facilitate matches between” publishers and advertisers, Korula said.
Google executives testified that the company had helped consumers and competitors by dedicating thousands of employees and many millions of dollars to fighting ad fraud and spam. Breaking up Google’s ad unit, the company has argued, would weaken its ability to combat those who wanted to commit crimes.
Per Bjorke, a Google director of product management, said that with a comprehensive ad platform, Google “can much more easily fight spam.”
He compared Google to a credit card company, saying that without knowing details about transactions, it would not be able to stop fraud.
Government lawyers argued that ad industry groups and companies also fought fraud, piracy and malware, and that competitors had sometimes informed Google that there was suspicious activity on its platform.
Google argues publishers and advertisers have plenty of choice
The company does not lock advertisers and publishers into an unfair system, its lawyers said. Google witnesses testified that the company offered a wide range of advertising tools, which its customers are able to pick and choose from.
Sarah Stefaniu, a Google employee who previously worked for the company as an ad manager, testified that advertisers could choose different products depending on their needs.
Government lawyers have contended that Google is the central player in online display ads, the type of promotion that would be featured alongside an article on a news website. Google’s lawyers have described this as an inaccurate framing of the ad market, saying that display ads come in a variety of formats and can be placed virtually anywhere.
On Wednesday, the company’s lawyers played deposition footage from Todd Parsons, the chief product officer of one of Google’s advertising rivals, Criteo, who said display ads were increasingly popular on social media sites like Instagram and Facebook and on smart TVs.
Adam Stewart, a Google vice president who oversees some large ad sales, testified that in 2019 the company was worried about its competitiveness in display ads.
“We recognized that we were losing share” to Facebook and to the Trade Desk, a rival ad tech firm, Stewart said, while Google’s lawyers showed internal company documents about the competitive landscape.