Google has once again avoided being broken up, even after a federal judge found that the company illegally monopolized important parts of the online advertising market.
US District Judge Leonie Brinkema rejected the Justice Department’s request to force Google to sell its AdX advertising exchange, choosing behavioral restrictions instead. The full details of those restrictions remain sealed for now.
Google Keeps Its Ad Tech Business
The case focused on Google’s control over tools used by publishers to sell online advertising.
In an earlier ruling, Brinkema found that Google illegally dominated the markets for publisher ad servers and ad exchanges, including by tying publishers using its ad server more closely to AdX.
The Justice Department wanted Google to sell AdX and proposed other structural changes. Instead, the judge accepted most of the proposed behavioral remedies, which are expected to require Google to work more fairly with competing ad-tech services.
AdX is relatively small compared with Google’s overall business. Court-related estimates showed Google Ad Manager represented around 4.1% of revenue and 1.5% of operating profit in 2020.
Big Tech Breakups Remain Difficult
The ruling adds to a broader pattern.
It is the third time in roughly a year that US antitrust authorities have failed to secure the breakup of a major technology company. Google also avoided a forced sale of major assets in its separate search monopoly case, while Meta previously avoided being forced to divest Instagram and WhatsApp.
That has frustrated antitrust advocates who argue that behavioral restrictions may not be strong enough to reduce the market power of dominant technology companies.
Others argue that breaking up companies such as Google could create new problems by strengthening competitors including Apple, Amazon or other large platforms.
What It Means for Alphabet
For Alphabet, the decision removes one of the biggest potential structural risks hanging over its advertising business.
Google will still face new restrictions and continued regulatory scrutiny, but it keeps ownership of its core ad-tech infrastructure.
Investor takeaway: The ruling is another important legal win for Alphabet. Google has been found to hold illegal monopolies, but courts have so far been reluctant to force major breakups. That reduces one of the biggest long-term risks investors had been watching.
