Google and the US Justice Department each believe the other wants too much of one thing: control.
Technology
Google and DOJ’s ad tech fight is all about control
/cdn.vox-cdn.com/uploads/chorus_asset/file/25606866/STK445_ADVERTISING_STK093_GOOGLE_D.jpg "Google and DOJ’s ad tech fight is all about control")
“Control is the defining characteristic of a monopolist,” DOJ counsel Julia Tarver Wood said during opening statements in the federal government’s second antitrust trial against the search giant, which kicked off Monday in Alexandria, Virginia. To the government, Google exerts too much control over every step in the way publishers sell advertising space online and how advertisers buy it, resulting in a system that benefits Google at the expense of nearly everyone else.
“Control is the defining characteristic of a monopolist”
To Google, the government is seeking control over a successful business by making it deal with rivals on more favorable terms, disregarding the value of its investments in technology and the unique efficiencies of its integrated tools.
By the end of the trial, which is expected to last several weeks, US District Court Judge Leonie Brinkema will be left to decide which side is exerting too much control — and ultimately, if Google has illegally monopolized the markets for advertising technology.
Markets is a key word, since one question raised on the first day is how many monopolies Google might actually have. (A federal court in DC says at least one, since it recently ruled Google a monopolist in search.) The DOJ is arguing that Google has monopoly power in three different ad-related markets: those for publisher ad servers (where websites hawk ad space), ad exchanges (which facilitate ad transactions), and advertiser ad networks (where advertisers go to buy ad space). They’re also arguing that Google illegally tied together its publisher ad server with its ad exchange to maintain its monopoly power.
“One monopoly is bad enough,” Wood said during opening statements. “But a trifecta of monopolies is what we have here.”
“A trifecta of monopolies is what we have here”
Google says it’s not a monopolist, and in fact there’s only one market: a two-sided market made of buyers and sellers of online ad inventory. In opening arguments, its counsel said the government is ignoring relevant Supreme Court precedent that says this is the best way to view such a market. The company also argues regulators are carving up the field with terms like “open web display advertising,” which Google calls contrived. What the government really wants here, Google claims, is to require it to deal with its rivals — something the Supreme Court has said isn’t really the job of the judicial system.
After opening statements, the DOJ began calling its first witnesses, focusing on the tools publishers use to monetize display ads. These are the ads that typically pop up at the top or the side of the page on news websites and blogs, populating through super-quick auctions that run while the page loads. During the auction, an ad exchange helps match publishers and advertisers based on things like topic and price without active intervention by a human. The process is called programmatic advertising, and it’s used by The Verge’s parent company Vox Media among many others. (Vox Media president of revenue and growth Ryan Pauley is on the list of potential witnesses but wasn’t called today.)
Google’s tools play an essential role in the process, with some of them holding about 90 percent of the market, according to the government. Google has a publisher ad server called Google Ad Manager (formerly DoubleClick for Publishers, or DFP), which helps publishers sell ad space. It operates an ad exchange, AdX, that facilitates transactions. And it owns an advertiser ad network, rounding out its trifecta of major products across different parts of the ad world.
Four industry players testified Monday, representing a publisher (Tim Wolfe, SVP of revenue at Gannett), an ad exchange (Andrew Casale, president and CEO of Index Exchange), a marketer (Joshua Lowcock, president of media at Quad), and a publisher ad network (James Avery, founder and CEO of Kevel). Across the testimonies, the government tried to establish that programmatic display advertising is not something publishers can easily substitute with other types of advertising, including direct deals with advertisers or ads on social media sites. And it introduced the idea that switching from Google tools isn’t such an easy decision, even when there might be some reason to do so.
In testimony, for instance, Wolfe and Avery both made clear that publishers are largely unwilling to switch away from Google Ad Manager. They said it’s because Google packages it with access to AdX, and losing that package deal would mean giving up large amounts of revenue — even if rivals offer to take a much smaller cut for facilitating each ad sale. Wolfe testified that when Gannett received one such offer, that reduced take rate didn’t move the needle, since it wouldn’t offset the benefits of AdX.
The ad server company Kevel started by targeting traditional publishers, but Avery says competing with Google proved impossibly hard. He recalled publishers asking how his company would replace the revenue they made from AdX, something Kevel simply couldn’t manage. After trying to engage Google twice about ways to connect Kevel’s ad server with AdX, Avery testified, his efforts were rebuffed. Kevel pivoted to facilitating things like sponsored listings for retailers instead.
Speaking from the ad exchange perspective, Casale testified that switching ad servers is a big lift at the technical level, so publishers rarely do it. Building a new one is “very complex and expensive.” In the ad exchange market, Casale said competing with Google’s AdX is “very challenging,” and in experiments, reducing fees had barely a “nominal” impact on the ability to gain more business. Because of the huge network effects it takes to get an exchange off the ground, as well as the fact that it only gets visibility into ad impressions it wins, “I can’t imagine anyone starting a new exchange today,” he said.
Google’s attorneys poked at the witnesses’ arguments and credibility during cross-examination, pointing out ways players like Avery would benefit if the court forced Google to share access to its tools. Google will call its own witnesses to counter the DOJ later in the trial.
“I can’t imagine anyone starting a new exchange today”
This trial covers very different ground from last year’s antitrust fight in the District of Columbia. But on the first day of court, both sides alluded to their earlier battle. The Department of Justice mentioned during opening statements that another court had already adjudicated the question of Google’s search monopoly, referencing a ruling Judge Amit Mehta handed down just over a month ago. And although Mehta ruled mostly against Google, the tech giant cited a piece of the ruling that went in its favor. The topic? A DOJ argument Mehta interpreted as a requirement for Google to cut deals with competitors — and, accordingly, dismissed.
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/cdn.vox-cdn.com/uploads/chorus_asset/file/24924653/236780_Google_AntiTrust_Trial_Custom_Art_CVirginia__0003_1.png "Google’s counteroffer to the government trying to break it up is unbundling Android apps")
The Department of Justice’s list of solutions for fixing Google’s illegal antitrust behavior and restoring competition in the search engine market started with forcing the company to sell Chrome, and late Friday night, Google responded with a list of its own (included below).
Instead of breaking off Chrome, Android, or Google Play as the DOJ’s filing considers, Google’s proposed fixes aim at the payments it makes to companies like Apple and Mozilla for exclusive, prioritized placement of its services, its licensing deals with companies that make Android phones, and contracts with wireless carriers. They don’t address a DOJ suggestion about possibly forcing Google to share its valuable search data with other companies to help their products catch up.
According to Google’s lawyers, the ruling pointed to arrangements with Apple and Mozilla for their browsers, the companies that make Android phones, and wireless carriers. Google regulatory VP Lee-Anne Mulholland writes on the company blog, “This was a decision about our search distribution contracts, so our proposed remedies are directed to that.
For three years, its proposal would block Google from signing deals that link licenses for Chrome, Search, and its Android app store, Google Play, with placement or preinstallation of its other apps, including Chrome, Google Assistant, or the Gemini AI assistant.
It would also still allow Google to pay for default search placement in browsers but allow for multiple deals across different platforms or browsing modes and require the ability to revisit the deals at least once a year.
While the company still plans to appeal Judge Amit Mehta’s ruling that said, “Google is a monopolist, and it has acted as one to maintain its monopoly,” first, it says it will submit a revised proposal on March 7th, ahead of a two-week trial over the issue in April.
After 9/11, Washington, D.C.’s airspace got a significant security boost.
Now, over two decades later, this system is getting a cutting-edge makeover.
The National Capital Region (NCR) is rolling out an advanced artificial intelligence-based visual recognition system that’s taking air defense to a whole new level.
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Advanced artificial intelligence-based visual recognition system. (Katie Lange/DOD)
The new eyes in the sky
The Enhanced Regional Situational Awareness (ERSA) system represents a dramatic upgrade from previous security technologies. These new cameras are giving air defense operators unprecedented capabilities in monitoring and protecting critical airspace. They come with some seriously cool features that take air defense to the next level.
WHAT IS ARTIFICIAL INTELLIGENCE (AI)?
The cameras boast infrared vision with RGB filters for heat signature detection, allowing operators to spot targets even in low visibility conditions. A laser range finder provides accurate distance and altitude measurements, enhancing the system’s precision. Machine learning elements enable enhanced auto-tracking capabilities, making it easier to follow objects of interest. Additionally, a visual warning system is in place to alert non-compliant aircraft, using red and green lasers to illuminate cockpits and prompt immediate action from pilots.
Advanced artificial intelligence-based visual recognition system. (Katie Lange/DOD)
SAN FRANCISCO ROLLS OUT AI-POWERED CAMERAS TO COMBAT CRIME
The brains behind the operation
The Eastern Air Defense Sector (EADS) in Rome, New York, works in close coordination with the Joint Air Defense Operations Center (JADOC) at Joint Base Anacostia-Bolling to manage the ERSA system. This integrated approach ensures comprehensive surveillance and rapid response to potential threats. Air Force Master Sgt. Kendrick Wilburn, a capabilities and requirements officer at JADOC, explains that the system allows for more precise radar data validation. When uncertain radar data is detected, operators can use the cameras as an additional resource to confirm and assess the situation. This collaborative effort between EADS and JADOC enables swift decision-making and effective threat mitigation.
Teleidoscope team with upgraded electro-optical/infrared cameras in 2021. (Defense Innovation Unit)
360° THROWABLE TACTICAL CAMERAS ARE CHANGING THE GAME FOR THE MILITARY AND LAW ENFORCEMENT
Technological innovation
The ERSA system, developed by Teleidoscope, underwent rigorous testing in 2022, with air defense operators evaluating prototypes from three companies. Teleidoscope’s cameras stood out due to their advanced software enhancements and significant improvements over existing systems. The Defense Innovation Unit played a crucial role in securing funding through the Air Force’s Accelerate the Procurement and Fielding of Innovative Technologies (APFIT) program, demonstrating a commitment to rapidly deploying cutting-edge defense technology. Marine Corps Maj. Nicholas Ksiazek of the Defense Innovation Unit likened the upgrade to “the technological leap we saw between a 2011 iPhone and a current one,” highlighting the substantial advancements in capability. Currently, two operational cameras have been installed, with plans to add seven more annually, ensuring continuous improvement of the NCR’s air defense capabilities.
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Kurt’s key takeaways
The rollout of the ERSA system marks a significant step forward in air defense for the National Capital Region. With AI-powered cameras that enhance detection and tracking capabilities, operators are equipped to respond to potential threats more effectively than ever before. This integration of advanced technology and skilled personnel underscores our commitment to national security, ensuring that Washington, D.C.’s airspace remains safe and secure as we move into the future.
What are your thoughts on expanding advanced air defense technologies like the ERSA system to other major cities across the country—do you believe they would enhance national security, or are there potential drawbacks to consider? Let us know by writing us at Cyberguy.com/Contact
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/cdn.vox-cdn.com/uploads/chorus_asset/file/25800106/mcon_controller_josh_king_ohsnap.jpg "Josh King’s viral slide-out MagSafe gamepad found a home at OhSnap and looks amazing")
It’s no taller or wider than an iPhone, so it should slide into a pocket. It’s got a MagSafe pattern of magnets to attach it to your magnetic ring device. You don’t have to remove it to use your phone like a phone, because the whole gamepad retracts underneath, a little like the slide-out keyboard phones (or PlayStation Phones) of old — and now, it’s mounted on a spring-loaded arm that pops out at the push of a button and also slightly angles your device towards your face.
OhSnap even found room for a pair of Nintendo Switch-esque analog sticks, with drift-resistant Hall effect sensors, and pair of fold-out grips so you can (theoretically) hold it more like a full-size gamepad. The sticks are clickable buttons, and it’s got a full set of shoulder buttons and triggers as well.
Two months ago, Retro Game Corps came away impressed with a prototype, and it seems King has been very busy since then. As he explains on YouTube, he initially tried to start his own company around the gamepad, even attracted a few investors, manufactured some boards and was working toward injection molding, before he started running out of money and reached out to OhSnap about a partnership.
Speaking of money, we don’t have any idea how much it’ll cost, particularly at retail — OhSnap is planning to launch a Kickstarter on January 2nd to raise funds. It’s taking signups here for now.
I should be getting my own hands on a prototype next month at CES 2025 in Las Vegas, and I’ll let you know how it feels.
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