Google has reportedly offered to split its ad auction business, which allows companies to buy advertising space on the web and in search results, into a slightly more segregated company if it helps avoid antitrust actions, Google said. a report of The Wall Street Journal† The offer is reportedly part of multiple concessions Google has offered to the US Department of Justice as it appears to prevent further lawsuits over alleged anti-competitive practices.
According to the WSJ, the move would be a collective shuffle. Rather than divesting parts of its advertising business into a completely separate company or selling them altogether, the proposal would make them a separate company from Alphabet. Alphabet is the holding company for the properties of Google, such as Google itself, Waymo and DeepMind. (Things like YouTube, Pixel, and, of course, AdSense are considered subsidiaries of the Google entity.) So while the ad auctions might no longer be run by Google, it would end up staying with the same people. According to the WSJthe change could move “tens of billions of dollars” in business.
Google’s dominance and scale in the app and web advertising industry has previously caught the attention of regulators. In 2020, the US government filed antitrust charges against the company, saying it “held unlawful monopolies in the markets for general search services, search advertising and general search text advertising.” The UK Competition and Markets Authority also recently launched an investigation into Google’s advertising practices, saying it planned to look into the company’s ad exchanges and markets.
Google probably wants to avoid further lawsuits and enforcement actions, which could end up forcing it to make changes much larger than the changes it offers. The Wall Street Journal reports that a new Justice Department lawsuit could be filed in the coming months if it doesn’t come to some sort of agreement with the company.
Reached for comment, Google spokesman Peter Schottenfels sent The edge the same statement to the Wall Street Journal†
We have engaged constructively with regulators to address their concerns. As we’ve said before, we have no plans to sell or discontinue this business, and we are deeply committed to providing value to a wide variety of publishers and advertiser partners in a highly competitive industry. rigorous contest in advertising technology has made online advertising more relevant, reduced costsand extensive options for publishers and advertisers.