Google won't be forced to break up its ads business
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Google won't be forced to spin off its "network" ad business, which sells ads on others publishers' inventory, a federal judge ruled on Wednesday.
Why it matters: It's a massive win for the tech giant, which was found guilty last April of violating U.S. antitrust laws by exploiting its dominance of the online advertising and ad-tech markets.
Zoom in: In her Wednesday ruling, U.S. District Judge Leonie M. Brinkema said Google would have to make changes to its ads business but did not specify what those behavioral remedies would be.
- Google, which has sought to appeal the April ruling, has been trying to convince a judge that the Justice Department's proposed remedies, or penalties, for losing the case go far beyond the law.
- In a statement, Google's VP of Regulatory Affairs Lee-Anne Mulholland said, "We're very pleased the Court rejected the DOJ's proposal to break apart tools that help small businesses reach new customers and grow."
Catch up quick: The federal government and 17 states sued Google in 2023, arguing the company unlawfully maintained and exploited its ad monopoly in the open-web display publisher ad server market and the open-web display ad exchange market.
- They sought to force Google to sell off part of its "network" ad business, which accounted for roughly 12% of Alphabet's overall revenue at the time.
- Google argued spinning out that part of its business would actually hurt publishers, because it would force them to buy ads through more expensive rival networks.
Zoom out: The U.S. has taken a much more lenient approach to punishing Google for antitrust violations compared to Europe.
- In 2024, a federal judge found Google guilty of violating U.S. antitrust laws around its search practices, but the company wasn't forced to spin off its popular Chrome browser or Android operating system as a result.
- European antitrust officials, meanwhile, have levied over $10 billion worth of antitrust fines against Google over the past few years, including a $3.5 billion fine related to ad tech last September, another $1.7 billion ad tech fine in 2019, a $4 billion mobile fine that was upheld in 2022 and a $2.7 billion search fine in 2017.
The big picture: The latest ruling has enormous implications for the $1 trillion global advertising economy.
Editor's note: This is a breaking news story and will be updated.
