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Shortly before the vacation, 44 states filed two separate proceedings and 16 separate state laws alleging that Google violated Sherman Act. A total of 245 pages of proceedings seek to dismantle the company and force it to pay damages, perhaps three times as much as hundreds of billions of dollars. In a nutshell, the proceedings focus on two main themes: Google tried to monopolize the online search engine market (search proceedings), and Google tried to monopolize the online advertising market (ad tech proceedings). ).

Colorado-led proceedings are primarily tracking previous proceedings filed by the Justice Department. Google claims that computer and mobile device makers have set Google as their default search engine and illegally maintain their monopoly through exclusive contracts that require pre-installation of Google applications. Like the DOJ, the state states that Google uses exclusive contracts to monopolize the Internet of Things search components such as cars and voice assistants, and that Google’s algorithms are specialized search competitors such as Yelp and Expedia. I blame it for being disadvantageous to other companies.

Texas-led advertising technology proceedings improperly monopolize online advertising by allowing Google to favor auctions, collude with Facebook, and pressure advertisers to use a complete suite of advertising tools. Claims to be doing. At the heart of the proceedings is that Google uses that size to give it an unfair competitive advantage when it comes to advertising. For example, in the proceedings, Google promised advertisers that they could use the tool to place ads on competing engines and exchanges, but in reality it was in favor of them. Claims to have been. According to complaints, Google provided Facebook with incentives and more data in exchange for Facebook’s agreement to limit competition in Facebook’s advertising auctions. Similarly, the state uses Google’s market power to withhold YouTube inventory from competing buy-side ad purchasing tools, and advertisers use Google tools to purchase ad space from major US video inventory providers. Claims to be forced to do.

The proceedings raise many complex de facto and legal issues that are likely to take years to resolve. But even at this early stage, some things become clear.

These proceedings, along with two proceedings against Facebook, have firmly moved the antitrust debate from Congress to court. Many reformers, especially the right as well as the left, are trying to expand the scope of antitrust law. Some proposals force companies to separate into a single business unit, impede the ability of one company to acquire another, and indefinite forms such as antitrust fairness and democratic ideals. It may even take into account the value of. With these proceedings pending, Congress is unlikely to enact major antitrust laws. Many reformers, including House of Representatives Jerrold Nadler, praised the proceedings as an important step in maintaining competition online. Given that existing legislation may allow courts to address competitive concerns, as written, antitrust reformers should have Congress review antitrust law now. You will have a hard time convincing your colleagues that you have to. At least given that the most important antitrust proceedings in 20 years are currently in court, Congress needs to take a deep breath before trying to rewrite the first-century antitrust law.

The proceedings challenge the idea that vertical integration benefits consumers. Google advertises for advertisers and sells ad space for most ad-supported websites in the world. Google operates the most popular and popular search engines and many properties that attract millions of eyes, such as YouTube and map apps. Google’s popularity dominates the ad search market. Google provides tools to help advertisers evaluate their interactions with consumers and acts as an intermediary between publisher ad exchanges and their online advertising servers. According to the state, Google abuses its breadth by linking these services, accepting all services to advertisers and publishers, and reaching or reaching millions of eyes that are otherwise inaccessible. Force you to pay a higher price to increase your chances. Those looking for a more direct deal with other networks. At least in theory, this practice could violate antitrust law. In this explanation, Google’s use of search market power is a tying violation when Google (reportedly) limits the ability of customers to place ads on the most popular services such as YouTube. It is considered. Customers are also using Google’s suite of products. Google has every right to benefit its customers through its integrated services through low prices and efficient services, and in any case, to give preferential treatment to customers who use more of its services. Will argue. Facts become clear over time, but tying claims are generally notorious for being difficult to prove in court, and economic research suggests that vertical integration benefits consumers. Antitrust law enforcement agencies agree with this principle.

The proceedings seek to define a broader competitive environment. Most antitrust proceedings rely on the definition of the market. The narrower the market, the easier it is for a company to claim to have market power to charge higher prices. In these cases, the state defines the relevant markets as narrow as the Wisconsin election margin. For example, the state defines an advertising market that excludes television, radio, printed matter, and outdoor advertising, and a search market that excludes specialized search engines and social media advertising. In fact, the advertising technology proceedings claim that YouTube dominates the online in-stream video advertising market, which is similar to claiming that YouTube dominates the YouTube market. In fact, advertisers consume it on many other video streaming websites, including Facebook, Flickr, TikTok, Twitch, Twitter, Dailymotion, Snapchat, and even MySpace, which gets 15 million views each month. You can reach people.

The proceedings are trying to fix an already very competitive industry with many indicators. Online advertising prices are falling, overall advertising prices are falling, and output is rising. From 2010 to 2019, domestic spending on online digital advertising quintupled from $ 26 billion to about $ 130 billion. Over the same period, the cost of Internet advertising has fallen by nearly 40%. In general, these characteristics symbolize a highly competitive market rather than a monopoly-dominated market (monopolies tend to reduce production and raise prices to maximize profits).

The court needs to sort out many hotly contested facts. Perhaps the most intriguing allegations, the state has accused Google of colluding with Facebook to limit competition in advertising auctions and benefit both companies. Google argues that Facebook isn’t favored, dozens of other companies are bidding on the same auction, and Google doesn’t keep its agreement with Facebook secret. Many of the state’s complaints have been edited, so it’s clear over time whether the state has identified facts in favor of viable antitrust laws.

On another controversial allegation, the state limits Google’s ability to compete with specialized vertical providers in certain market segments such as travel, home renovation, and entertainment, and those companies to acquire customers. It claims to be intentionally restricted by doing so. So, for example, Google is charged to downgrade the search visibility of companies such as Expedia and TripAdvisor in order to benefit their assets. Google argues that search results prioritize the company itself over the intermediary, allowing the company to connect directly with its customers. In this regard, Google may receive some assistance from the Federal Trade Commission. In 2013, the FTC investigated alleged search biases and concluded that Google’s search tools are likely to benefit consumers, and Google provides quality results rather than choking competitors. I found that I designed the search tool to do so. The court categorizes whether the FTC understands it correctly, whether the material has changed, whether Google designs search algorithms to hurt competition, or simply provides individuals with the results Google wants. is needed.

Before the proceedings are closed, real-world events can lead to more competition in the market. State proceedings, including appeals, will probably take a few years. Maybe longer. By that time, the competitive environment may look very different. Apple reports that it plans to turn Siri into an independent search engine rather than the voice of Google search. If so, three of the world’s largest tech companies will compete fiercely in the general search market. Amazon, the fourth company, already outperforms Google in product search, where search engines make almost all the money. Uncompetitive Wal-Mart recently launched its own self-service advertising platform. Smart TVs will soon be able to offer personal advertising beyond existing competitors. European regulators are actively pushing tech companies by preying on American rivals. Chinese companies continue to invest strategically in early technology.

As has often happened throughout the last century, markets will move much faster than the court system, especially in industries that are as dynamic as technology. Today’s competitive landscape may seem archaic by 2025 standards, for example, but the 2008s landscape dominated by MySpace and AOL seems quaint today. Therefore, the proceedings are certainly monitored, but the real guarantor of the competition may be out of court.

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