Five key takeaways from Google's defense against the DOJ

Google continues to dominate the news cycle this week, fresh from its announcement that it will stop linking to New Zealand news if lawmakers pass a proposed 'link tax' law. This legislation is part of New Zealand's broader effort to require digital platforms like Google and Meta to compensate media outlets for news content, mirroring similar regulations in Australia and Canada. NZ officials argue that platforms benefit unfairly from news content while traditional media struggles in the digital age. However, Google claims this would undermine the open internet and disrupt its existing commercial agreements with publishers. This standoff adds yet another chapter to the ongoing global tension between tech giants and governments over the monetisation of news.

This latest controversy is amongst the backdrop of Google's unfolding antitrust trial with the US Department of Justice (DOJ), where it stands accused of monopolistic practices in digital advertising. As the trial moves towards closing arguments, scheduled for November 25, its outcome could reshape the digital advertising ecosystem.

Ahead of this, Campaign breaks down Google’s key defence strategies and explore the implications for marketers.

1. Framing adtech as a two-sided market

Google’s central argument is that its adtech operates as a 'two-sided market,' where both advertisers and publishers derive mutual benefit. This framing positions Google as a platform that supports the entire digital ecosystem, not just advertisers. For marketers, this suggests that Google’s tools offer a balance of value, helping brands reach audiences while also supporting content creators. However, if the DOJ’s case prevails, it could expose deeper issues, such as whether this balance is truly equitable or if it restricts publishers' freedom to set competitive rates. Marketers may find themselves more reliant on fewer dominant platforms, which could drive up costs or limit flexibility in campaign planning.

2. Downplaying financial significance of ad revenue

In its defence, Google has sought to downplay the financial importance of its adtech business. Testimonies from Google’s finance director argue that some areas, such as display advertising, are not as profitable as one might assume. While this may bolster Google's argument that it doesn’t have an overwhelming financial grip on the industry, it does little to ease concerns for marketers. Even if certain segments of Google’s adtech business aren’t the most lucrative, they still play a crucial role in digital marketing. Marketers should remain aware that any perceived downplaying could obscure the significant market influence Google retains, potentially affecting pricing structures and competitive positioning in the industry.

3. Integration equals innovation

Google's argument that integrating services like Ad Exchange and DoubleClick promotes innovation and security is another cornerstone of its defence. While this may sound like a win for advertisers—offering streamlined processes and improved data protection—it also raises concerns about competition. For marketers, Google's dominance in these integrated services may seem convenient, but it could ultimately stifle third-party innovations that offer new approaches to targeting, measurement, and creative solutions. Should the DOJ succeed in pushing back against this model, marketers might face a more fragmented but potentially more diverse adtech ecosystem, opening up new opportunities to diversify their campaigns.

4. Highlighting competition from emerging channels

Google has been keen to highlight that the adtech landscape is competitive, with platforms like social media and retail media networks growing rapidly. The company argues that this undermines the DOJ's claims that Google is an uncontested gatekeeper. For marketers, this is a reminder that while Google is a key player, alternatives are emerging—offering more channels to reach consumers. However, the fact that Google remains at the forefront raises concerns that even with emerging competition, the reliance on its tools may not diminish soon. Marketers may want to explore these emerging platforms to ensure they’re not overly dependent on one ecosystem, but also weigh the reach and efficiency Google continues to offer.

5. Shifting focus from publishers' disadvantages

Google’s defence seems to pivot away from the disadvantages publishers face in its ecosystem. The DOJ has argued that Google’s dominance limits publishers' control over ad inventory and reduces profitability. For marketers, this may be problematic. While Google offers broad reach and efficiency for campaigns, its dominance could be creating an environment where fewer high-quality content providers can survive, thereby shrinking the variety of trusted environments where ads appear. If publishers continue to be marginalised, it could lead to a drop in the quality and safety of advertising placements, affecting brand reputation and effectiveness.

What to expect next

With closing arguments set for November 25, the stakes are high for both Google and the wider digital advertising industry. Should the DOJ win its case, it could lead to significant regulatory changes, potentially fragmenting Google's adtech empire. For marketers, this would mean navigating a more complex landscape with increased competition among platforms, offering diverse opportunities to reach audiences in new ways. However, the transition may also bring short-term instability, as alternative platforms vie for dominance and advertisers reassess their strategies. Ultimately, this trial could reshape not only Google’s role but the entire framework of digital advertising, leaving marketers to adapt to a future that may prioritise innovation, transparency, and competition over the current status quo.