The company further shed light on how there are many alternatives present for both publishers and advertisers. But experts feel otherwise, claiming these statements are misleading.
Several different tech providers are trying to compete in the ad industry, but it’s Google that dominates the pivotal areas of the market. This includes ad exchanges, demanding platforms, and advertising networks.
While Google does have some competitors on the basic level, the gap between market share and its second biggest competitor Microsoft is huge and it’s been like this for years.
| Company | Alphabet | Microsoft | Baidu | Yandex |
|---|---|---|---|---|
| 2020 Ad Revenue (Billion USD) | 146.92 | 6.41 | 10.56 | 1.37 |
| 2021 Ad Revenue (Billion USD) | 209.49 | 6.94 | 12.51 | 1.79 |
| 2022 Ad Revenue (Billion USD) | 224.47 | 11.59 | 10.83 | 2.49 |
| 2023 Ad Revenue (Billion USD) | 237.86 | 12.21 | 11.51 | 3.71 |
Both advertisers and publishers don’t really have a lot of choices at the end of it all. As per research, the majority of digital ad spending goes through Google’s ad stack which limits choices.
Meanwhile, we saw in a recently held conference how companies would need 17 years for data collection which the search engine giant can do in a year or so. Did we mention how these ad purchases are not cheap?
So many reports showed how the costs for ads are on the rise. Since Google’s search CPCs were up 9%, it pushed ad spending to 17%. As a result, brands needed to diversify.
Next, Google Search CPC was up 13% while retail saw a 5-year 50% rise in CPC. Furthermore, search ad pricing increases and that means conversion rates are on the decline end of things again white CPCs increased in more than 60 sectors.
Google continued to argue that so many other advertising tech giants are present that compete in the same space. Moreover, ad buyers mix tools with other competitors and hence don’t get to keep all the fees. Also, the fee is lower than what the average figure in the industry happens to be. So many small firms would get hurt along the way by such cases, it mentioned.
Critics pointed out how Google constantly beats the drum about its positive image and flawless practices.
Google hints that purchasing online ads is simple and low in cost but the reality is far from it. Google ads are not so straightforward anymore.
Google is not talking about how much of a dominant name it is in the world of search. Meanwhile, that advantage has 80% of the search intent data that puts every other ad tool from Google in the driving seat, even when big competitors are competing. If they leverage all the search intent on their products, they’ll always be winning.
However, some experts are on Google’s side. They feel that the issue lies with the definition of the market. The market today needs to be linked to digital ads and not non-product ads that feature only texts.
There was also agreement that you cannot assess Google’s fee as it’s not a simple task by any means. To compare that with others is absurd because a lot has to be considered and not everything is transparent.
Last but not least, SMBs will end up losing if the DOJ wins SMBs. it’s not an easy process and the DOJ winning the case will make the system healthy but we can expect many challenges and pain along the way.
In the long run, many do hope to attain a healthy and better ecosystem but in the short run, it’s going to be painful for advertisers and very brutal in the end.
Google has worked long and hard to display itself as a true market leader having free internet that’s open sourced. Now the issue is that the DOJ argued ad tech is doing the opposite. It restricts choices, raises costs, and puts publishers on the extreme end of the spectrum.
So what can we expect next? Well, this case will test all the claims that Google makes against the Department of Justice which has a lot of evidence about the company’s anticompetitive behavior as well as practices.
Read next: EU’s Highest Court Confirms Record $2.7 Billion Fine Against Google For Anti-Competitive Shopping Services
by Dr. Hura Anwar via Digital Information World
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