ALEXANDRIA, Va. – It happens in milliseconds, ideally, as you browse the web. Networks of computers and software analyze who you are, what you are looking at and buy and sell the advertisements you see on web pages.
The company that most likely determines which ads you get, and how much an advertiser paid to get on your screen, is Google.
In fact, the Justice Department and a coalition of states say Google’s dominance over the technology that controls the sale of billions of Internet display ads every day is so thorough that it constitutes an illegal monopoly that should be broken up.
A trial under way in federal court in Alexandria, Virginia, will determine if Google’s ad tech stack constitutes an illegal monopoly. The first week has included a deep dive into exactly how Google’s products work together to conduct behind-the-scenes electronic auctions that place ads in front of consumers in the blink of an eye.
Online advertising has rapidly evolved. Fifteen or so years ago, if you saw an internet display ad, there was a pretty good chance it featured people dancing over their enthusiasm for low mortgage rates, and those ads were foisted on you whether you were looking at real estate or searching for baseball scores.
Now, the algorithms that match ads to your interests are carefully calibrated, sometimes to an almost creepy extent.
Google, for its part, says it has invested billions of dollars to improve the quality of ads that consumers see, and ensure that advertisers can reach the consumers they’re seeking.
The Justice Department contends that what Google has also done over the years is rig the automated auctions of ad sales to favor itself over other would-be players in the industry, and also deprived the publishing industry of hundreds of millions of dollars it would have received if the auctions were truly competitive.
Government witnesses have explained the auction process and how it has evolved over the years in detail at the Virginia trial.
In the government’s depiction, there are three distinct tools that interact to sell an ad and place it in front of a consumer. There’s the ad servers used by publishers to sell space on their websites, particularly the rectangular ads that appear on the top and right-hand side of a web page. Ad networks are used by advertisers to buy ad space across an array of relevant websites.
And in between is the ad exchange, which matches the website publisher to the would-be advertiser by hosting an instant auction.
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