Google dominates online ads, says antitrust trial witness, but publishers are feeling ‘stuck’

Google’s software that lets publishers promote advert area on their web sites is ubiquitous, but that’s largely a testomony to how exhausting it’s for patrons to get out of it, one former publishing government testified in federal court docket on Tuesday.

“I felt like they were holding us hostage,” mentioned Stephanie Layser, a former programmatic promoting government at News Corp (which owns manufacturers like The Wall Street Journal and the New York Post) who now works at AWS. Layser was testifying as a authorities witness within the Justice Department’s second antitrust case towards Google, which is accusing the company of monopolizing the markets for ad tech tools and illegally tying collectively two of its merchandise.

Layser was one among three witnesses the court docket heard from on Tuesday, protecting views from the writer facet, the advertiser facet, and inside Google. Through their testimony, the federal government is trying to color an image of an organization that exerts a lot management over the markets for advert tech instruments that clients don’t stroll away, even within the face of unfavorable adjustments. That’s as a result of, in keeping with the federal government, Google has protected its monopoly energy, stopping sufficient alternate options and true competitors from rising. Google, for its half, says the federal government is punishing it for achievement and making an attempt to drive it to cope with rivals on extra favorable phrases.

Layser felt captured by a change Google rolled out in 2019, which prevented publishers from setting greater ground costs only for Google’s advert alternate, AdX, underneath what it known as unified pricing guidelines (UPR). With UPR, Layser mentioned it was nonetheless potential to set completely different flooring for different exchanges inside every of their methods but not for Google’s. Publishers would possibly need to set the next ground value from AdX to allow extra competitors throughout advert auctions within the hope it will end in the next value than the minimal they’re keen to simply accept, she mentioned.

When Google launched UPR, Layser arrange a gathering with Google executives to precise her considerations and mentioned she believed this system was “in the best interest of Google and not in the best interest of their customers.” She didn’t recall how Google responded but mentioned that “nothing changed,” and this system was carried out.

Despite her grievances, Layser mentioned switching to a unique software was not a viable choice. That’s as a result of utilizing Google’s writer advert server, recognized on the time as DoubleClick for Publishers (DFP) and at this time as Google Ad Manager, was the one solution to entry the massive base of Google advertiser demand with real-time costs — which is necessary in a system the place computer-run advert auctions occur in milliseconds.

Layser even helped put collectively an evaluation at News Corp contemplating the professionals and cons of switching to a different writer advert server, AppNexus (later purchased by Microsoft and rebranded as Xandr), but decided the danger of shedding income with out the identical entry to Google Ads demand was too nice.

The resolution didn’t actually must do with the standard or value of Google’s product, nonetheless, Layser testified. “DFP is a 25- to 30-year-old piece of technology. It’s slow and clunky,” she informed the court docket. Google additionally offered News Corp much less perception into their transactions than they may have gotten with AppNexus, Layser mentioned. She “begged” Google for what she known as “log-level data” but by no means obtained it. And due to DFP’s limitations, Layser mentioned she was unable to tackle tasks she felt may maximize income. “I couldn’t innovate,” she mentioned. “I felt stuck.”

Despite DFP’s supposed drawbacks, the Department of Justice alleges the software has almost 90 % market share within the US. Layser, who beforehand consulted for upward of 70 publishers, mentioned she may consider “maybe three publications out of hundreds that don’t use DFP.” Because of its close to universality, she mentioned there are “legions” of publishing professionals who’ve solely ever labored with the Google software of their entire careers.

During cross-examination, Google’s attorneys identified that News Corp believed itself to be aggressive with Google in some areas, underscoring its declare that the DOJ is making an attempt to drive offers with rivals. In the evaluation about switching to AppNexus, News Corp wrote that as a result of Google owns a media enterprise, it was unlikely to have aligned pursuits with Google long run.

Later within the day, the court docket heard from Jay Friedman, CEO of the Goodway Group, who make clear the advertiser facet of the market. Friedman testified that Google’s AdX has been the one alternate his firm has not been in a position to negotiate charges with, although its charge is greater than others. “We were told it wasn’t an option,” he mentioned.

Then, the court docket heard prerecorded deposition from Eisar Lipkovitz, a former VP of engineering for show and video advertisements at Google. Lipkovitz mentioned he nonetheless has “PTSD” from his time at Google and expressed frustration with colleagues who disagreed along with his view of how the instruments ought to work or moved too slowly on tasks.

Lipkovitz mentioned he acknowledged a possible battle of curiosity in the way in which DFP and AdX have been built-in, and he described these within the firm who denied it as making “self-interested arguments.” Still, he credited an absence of alternate options to Google’s DFP to the issue of working such a product. “It’s a business that nobody wants,” he mentioned.