DOJ is suing Google and a lot of people think it could be broken up

[Matt_in_NE]

Summary

 

The United States Department of Justice, along with the attorneys general of New Jersey, California, Colorado, Connecticut, New York, Rhode Island and Virginia are suing Google for violating the Sherman Antitrust Act in regards to its ad business. The suit alleges Google deliberately sought out a dfominant position in every facet of digital advertising in order to manipulate the market, increasing their profits while also increasing the costs for advertisers and decreasinmg the revenue earned by content creators. Some news reports say that if the federal government is succesful in the suit, Google could be broken up. They've also taken the unusual step of seeking Google pay them back three times what the government has spent on advertising on Google. This is also the second time Google has been sued for antitrust violations -- in 2020 the DOJ under the Trump Administration filed suit regarding Google's search business. 

 

Quotes

Quote

It's not the overall market share that the DOJ is worried about, though: It's the market share of the individual tools used by publishers and ad companies. On the "sell side" (the side of websites that have ad space to sell—like this one), the DOJ says Google's "DoubleClick for Publishers" ad server has an over 90 percent market share. On the "buy side" (the side of advertisers that are looking for a spot for their ads), the Google Ads network for smaller businesses has an 80 percent market share, while "Display & Video 360" for big ad agencies has a 40 percent market share. The Google Ad exchange, which matches sellers and buyers, has a 50 percent market share.

 

My thoughts

I'm old enough to remember when Microsoft was on the verge of being broken up by DOJ because of Internet Explorer. I never saw much point in that -- there was genuine consumer demand for a package web browser. Microsoft's tactics that led them to become so dominant in business would have been more fruitful. I'm so used to a Googled internet that I'm not sure what to think about the possibility of not having one for the first time since the early 2000s. In many ways the "mature" internet is only possible because of these big tech companies so that we can all gather on Facebook or Twitter or whatever. One thing I will note is though the stories I read talking about the DOJ wanting to break up Google, the press release did not mention it.  

 

Sources

Ars Technica

 

CNBC

 

DOJ

[leadeater]

12 minutes ago, Matt_in_NE said:

Google could be broken up

And I could be the CEO of Google 

 

Successfully breaking up a company like Google is on the list of near impossible tasks, winning the lawsuit included.

[Matt_in_NE]

2 minutes ago, leadeater said:

And I could be the CEO of Google 

 

Successfully breaking up a company like Google is on the list of near impossible tasks, winning the lawsuit included.

I don't think it will happen, which is why I mentioned the Microsoft suit. But big companies have been broken up, like AT&T. They were pretty confident in themselves until the end. 

[Kisai]

1 minute ago, Matt_in_NE said:

Summary

 

The United States Department of Justice, along with the attorneys general of New Jersey, California, Colorado, Connecticut, New York, Rhode Island and Virginia are suing Google for violating the Sherman Antitrust Act in regards to its ad business. The suit alleges Google deliberately sought out a dfominant position in every facet of digital advertising in order to manipulate the market, increasing their profits while also increasing the costs for advertisers and decreasinmg the revenue earned by content creators. Some news reports say that if the federal government is succesful in the suit, Google could be broken up. They've also taken the unusual step of seeking Google pay them back three times what the government has spent on advertising on Google. This is also the second time Google has been sued for antitrust violations -- in 2020 the DOJ under the Trump Administration filed suit regarding Google's search business. 

 

Quotes

 

My thoughts

I'm old enough to remember when Microsoft was on the verge of being broken up by DOJ because of Internet Explorer. I never saw much point in that -- there was genuine consumer demand for a package web browser. Microsoft's tactics that led them to become so dominant in business would have been more fruitful. I'm so used to a Googled internet that I'm not sure what to think about the possibility of not having one for the first time since the early 2000s. In many ways the "mature" internet is only possible because of these big tech companies so that we can all gather on Facebook or Twitter or whatever. One thing I will note is though the stories I read talking about the DOJ wanting to break up Google, the press release did not mention it.  

 

Sources

Ars Technica

 

CNBC

 

DOJ

 

Well breaking it up would be difficult. But claiming that Google has a monopoly on advertising is out of touch with reality.

 

Tracking however. Yes. Google absolutely does.

 

What should be broken up about google is one of three outcomes:

- Break Google search out of Alphabet

- Break Youtube out of Alphabet

- Break the entire ad system out of alphabet

 

Google search is degraded by having ads on it. It's slowly turning into a "ad search engine" because you can't trust the search results if you're actually looking to buy something. That means Google has not been on the ball about returning good quality results for a while, and many counterfeit sites show up instead of the legitimate sites.

 

Youtube, is a monopoly, on both UGC video AND video ads. Unwinding it from Google would be something painful to Google without google subsidizing it's bandwidth.

 

Breaking the ad system out of alphabet would be the "better" outcome in theory, but I think what would really happen is ad quality would rapidly go down the toilet as sites like Youtube would no longer have control over the ad quality, or the targeting. Remember, ads can't develop contextually relevant data from video, only text. And next to no video has captions on it to make those context relevance.

 

We've known that for nearly 20 years that ad revenue has been going down BECAUSE of google. It's algorithms push valuable ads to the 1% of "valuable content", and low-paying garbage to everyone else. It's been a common refrain among non-text content creators that you need "text" if you want ads, and google is the single worst source of ad revenue.  If you are putting comics on the internet, you need to transcribe the comic, or you will get irrelevant ads, or maybe no paying ads. For youtube, it's largely been reading those youtube-generated captions(want to know how I know? all my videos have exact captions, and it's pretty clear it's reading the captions in some form) to figure out context, or it's description.

 

But should google be broken up to split the advertising from it alone, I think the first thing you'd see is Google wanting to charge you for gmail and youtube. Just look at the gestures it's been making to do both. Gsuite? Gone. "Watch in 4K requires paid subscription"

 

So I think breaking the ads out of google might actually result in Youtube going out of business.

[Zodiark1593]

14 minutes ago, Kisai said:

 

Well breaking it up would be difficult. But claiming that Google has a monopoly on advertising is out of touch with reality.

 

Tracking however. Yes. Google absolutely does.

 

What should be broken up about google is one of three outcomes:

- Break Google search out of Alphabet

- Break Youtube out of Alphabet

- Break the entire ad system out of alphabet

 

Google search is degraded by having ads on it. It's slowly turning into a "ad search engine" because you can't trust the search results if you're actually looking to buy something. That means Google has not been on the ball about returning good quality results for a while, and many counterfeit sites show up instead of the legitimate sites.

 

Youtube, is a monopoly, on both UGC video AND video ads. Unwinding it from Google would be something painful to Google without google subsidizing it's bandwidth.

 

Breaking the ad system out of alphabet would be the "better" outcome in theory, but I think what would really happen is ad quality would rapidly go down the toilet as sites like Youtube would no longer have control over the ad quality, or the targeting. Remember, ads can't develop contextually relevant data from video, only text. And next to no video has captions on it to make those context relevance.

 

We've known that for nearly 20 years that ad revenue has been going down BECAUSE of google. It's algorithms push valuable ads to the 1% of "valuable content", and low-paying garbage to everyone else. It's been a common refrain among non-text content creators that you need "text" if you want ads, and google is the single worst source of ad revenue.  If you are putting comics on the internet, you need to transcribe the comic, or you will get irrelevant ads, or maybe no paying ads. For youtube, it's largely been reading those youtube-generated captions(want to know how I know? all my videos have exact captions, and it's pretty clear it's reading the captions in some form) to figure out context, or it's description.

 

But should google be broken up to split the advertising from it alone, I think the first thing you'd see is Google wanting to charge you for gmail and youtube. Just look at the gestures it's been making to do both. Gsuite? Gone. "Watch in 4K requires paid subscription"

 

So I think breaking the ads out of google might actually result in Youtube going out of business.

Does YouTube even make a profit? I feel spinning this off would probably also kill it. Maybe their form 10-K might have details, I’ll take a look. 

[Brooksie359]

1 hour ago, Kisai said:

 

Well breaking it up would be difficult. But claiming that Google has a monopoly on advertising is out of touch with reality.

 

Tracking however. Yes. Google absolutely does.

 

What should be broken up about google is one of three outcomes:

- Break Google search out of Alphabet

- Break Youtube out of Alphabet

- Break the entire ad system out of alphabet

 

Google search is degraded by having ads on it. It's slowly turning into a "ad search engine" because you can't trust the search results if you're actually looking to buy something. That means Google has not been on the ball about returning good quality results for a while, and many counterfeit sites show up instead of the legitimate sites.

 

Youtube, is a monopoly, on both UGC video AND video ads. Unwinding it from Google would be something painful to Google without google subsidizing it's bandwidth.

 

Breaking the ad system out of alphabet would be the "better" outcome in theory, but I think what would really happen is ad quality would rapidly go down the toilet as sites like Youtube would no longer have control over the ad quality, or the targeting. Remember, ads can't develop contextually relevant data from video, only text. And next to no video has captions on it to make those context relevance.

 

We've known that for nearly 20 years that ad revenue has been going down BECAUSE of google. It's algorithms push valuable ads to the 1% of "valuable content", and low-paying garbage to everyone else. It's been a common refrain among non-text content creators that you need "text" if you want ads, and google is the single worst source of ad revenue.  If you are putting comics on the internet, you need to transcribe the comic, or you will get irrelevant ads, or maybe no paying ads. For youtube, it's largely been reading those youtube-generated captions(want to know how I know? all my videos have exact captions, and it's pretty clear it's reading the captions in some form) to figure out context, or it's description.

 

But should google be broken up to split the advertising from it alone, I think the first thing you'd see is Google wanting to charge you for gmail and youtube. Just look at the gestures it's been making to do both. Gsuite? Gone. "Watch in 4K requires paid subscription"

 

So I think breaking the ads out of google might actually result in Youtube going out of business.

Youtube doesn't really have a monopoly on video. I mean they do on long form video but tiktok is very much a huge video sharing platform which somewhat competes with Youtube. Honestly you kind of need a huge company with alot of resources to make a website like Youtube even work which is why you don't really see a competitor. 

[Kisai]

1 hour ago, Brooksie359 said:

Youtube doesn't really have a monopoly on video. I mean they do on long form video but tiktok is very much a huge video sharing platform which somewhat competes with Youtube. Honestly you kind of need a huge company with alot of resources to make a website like Youtube even work which is why you don't really see a competitor. 

Not in this form no. But the point stands that if youtube were split from alphabet, or advertising was split from alphabet, Youtube would absolutely suffer.

 

Twitch, could have been the the youtube competitor we needed, but instead youtube slowly ate twitch's dinner, and then twitch decided that it won't archive anything more than two weeks. That makes uploading video a non-starter, and trying to do any kind of long-form or serial storytelling impossible.

 

Twitter had a Tiktok, it was called Vine. Pity they didn't know what they had. And now Twitter is trying to bring it back (twitter videos are 2m20s long but suck in quality and difficulty in uploading.)

 

As for Tiktok itself, I eventually see them allowing proper long-form video on the site, because short form stuff is basically disposable gen-z bait.

 

 

[Brooksie359]

1 hour ago, Kisai said:

Not in this form no. But the point stands that if youtube were split from alphabet, or advertising was split from alphabet, Youtube would absolutely suffer.

 

Twitch, could have been the the youtube competitor we needed, but instead youtube slowly ate twitch's dinner, and then twitch decided that it won't archive anything more than two weeks. That makes uploading video a non-starter, and trying to do any kind of long-form or serial storytelling impossible.

 

Twitter had a Tiktok, it was called Vine. Pity they didn't know what they had. And now Twitter is trying to bring it back (twitter videos are 2m20s long but suck in quality and difficulty in uploading.)

 

As for Tiktok itself, I eventually see them allowing proper long-form video on the site, because short form stuff is basically disposable gen-z bait.

 

 

Yeah twich was never really supposed to compete with youtube. Streaming is a very different beast than youtube videos. Granted youtube also does streaming so I guess they do technically compete. 

[porina]

6 hours ago, Kisai said:

And next to no video has captions on it to make those context relevance.

Youtube does machine generated captions, and even translations. Quality can vary, but it might suffice as a starting point.

[Mark Kaine]

6 hours ago, Zodiark1593 said:

feel spinning this off would probably also kill it

agreed because their current monetization schemes aren't really sustainable,  people generally hate ads, and even though yt is worse than a 1960s TV network, it seemingly doesn't pay off for them, and it's hard to break out of this, as servers for videos are obviously expensive, but i think i would still welcome this in hopes it could be replaced by something more reasonable and sustainable (time for bilibili to shine?  i don't see any adds on that service...)

[jagdtigger]

7 hours ago, leadeater said:

Successfully breaking up a company like Google is on the list of near impossible tasks

So just stick our head into the sand and pretend that having mega sized "we do whatever we want and you cant do anything about it"  corporations is normal and desirable? Dont really care if its successful or not, just put em up on the chopping block..... (and not just google)

[leadeater]

6 minutes ago, jagdtigger said:

So just stick our head into the sand and pretend that having mega sized "we do whatever we want and you cant do anything about it"  corporations is normal and desirable? Dont really care if its successful or not, just put em up on the chopping block..... (and not just google)

Sometimes reality sucks, because that really is the situation of the matter unfortunately. When a company is legit the size of a country GDP wise they bury the issue in courts until you give up or they get "enough of a win" to agree to do whatever it is and it'll be next to nothing.

 

Google, the perfect counter argument for the right to a fair trial lol.

[Taf the Ghost]

A couple of inter-related aspects.

 

The real background to the Microsoft Antitrust trial was that Netscape couldn't figure out a business model & because MS didn't do any lobbying. In fact, during that era of the Tech Boom, no one did any real lobbying. It's called "paying the Danegeld". Silicon Valley started heavy lobbying after the trial. The message was received loud and clear.

 

Google has been one of the biggest lobbying companies for years. Their staff was integral to both 2008 & 2012 Obama victories, but it was very notable they never seemed to get anything out of it. In fact, they seemed to lose on basically every policies front minus SOPA, though that had full industry anti-support for. I don't have an answer & I've never seen a consistent one offered about it, but it's been notable for a long time. Something about Google's spending vis a vis DC has been highly ineffective.

 

Those specific States are a little interesting. It probably points to the where the Ad Industry is located. No Delaware involvement is odd, as I imagine a lot of the companies would be incorporated there. Inspection of the companies registered/operating out of those States would likely add some depths to the factions involved.

 

Some things that'll probably come out, as a guess:

 

- Google strong armed a lot of companies in the Ad space. 

- They used their Ad dominance to keep competitors out of spaces they had competing products.

- YouTube has lost a lot of money. Think 12 figures, over the life of the company.

- They've used their tracking/cloud storage position to do a lot of surveillance on competitors. 

- After the Adpocalyses, they retaliated against a lot of companies.

- Rest of the company is a blackhole of money and couldn't survive on its own.

 

This will be fascinating to watch. I've mentioned the oddity around Google's lobbying and their complete lack of policy influence on here a couple of times. Its been... weird. I have no explanation for it. We're about to see how bad it can get. Though I imagine Google will probably settle by some means.

[Obioban]

10 hours ago, Zodiark1593 said:

Does YouTube even make a profit? I feel spinning this off would probably also kill it. Maybe their form 10-K might have details, I’ll take a look. 

Exactly why nobody can compete with youtube. They don't have to be profitable, everyone else does.

[Doobeedoo]

Laughs in Alphabet

[Kisai]

7 hours ago, porina said:

Youtube does machine generated captions, and even translations. Quality can vary, but it might suffice as a starting point.

All the videos I upload to youtube has captions, because I uploaded them. When the're missing, youtube usually can't transcribe it accurately.

 

However, most videos you see on youtube, only has ASR captions (Machine generated) and it can not tell the difference from the speaker/subject vs background voices.

 

Youtube's captions for english is reasonable, but throw in translation and it kinda sucks. Likewise foreign captions don't always work either. Most Machine ASR is trained on narration, not conversation, which is why it usually does a decent job on single-speaker enunciated narration, but flops as soon as there is a second speaker or the speaker speaks naturally or uses a "different voice" because the ASR is not expecting another voice. Thus far ASR's have generally been able to handle noise though.

 

[Taf the Ghost]

5 hours ago, Obioban said:

Exactly why nobody can compete with youtube. They don't have to be profitable, everyone else does.

No. It's only due to the rise of Mobile in the last couple of years that YT isn't a black hole of monetary losses. A soft estimate is YT has lost over 100 billion USD over its existence. It was actually pretty telling when they started getting happy about YT's quarterly revenue. Youtube's expenses are as much as Facebook if not more. Publicly, YT's revenue might cover core expenses, at this junction, making them a money losing going concern.  I should find when I first mentioned "illegal cross subsidization" around here. It's probably been 5 years or more. This has been known for a long time in the analyst set. Keep an eye on Venmo's executives being called to testify in the Anti-Trust trial. 

 

But, YT has actually shifted in the last few years, post COPPA slapdown, on generating more revenue. It seemed pretty clear there was a directive given to actually not be such a dead weight on the finances. Probably because anti-trust was eventually going to to happen and YoutTube's fill rates are going to be a huge part of that advertising abusive positioning. 

 

It's only been the last couple of years where there's some other video platforms that can at least keep the lights on, on the their own, but no one else is offers any cut like YT does. Why? Because no one can fill ad inventory because of the Google's Ad position. 

 

All that said, I don't expect Google to get diced up. Unless Google's faction(s) have lost a massive power struggle among the power factions, they'll survive. There will be some deal. The fact it's a favorable administration to them and States that would be as well, points to it probably being as much of a shakedown for money as anything else. Going into another recession, there's going to be a lot of States with some really bad finances. Google has money. Sometimes, it's as simply about the Taxman.

[Arika]

6 hours ago, Doobeedoo said:

Laughs in Alphabet

A b c d e f g h i j k lolol

[Zodiark1593]

14 hours ago, Obioban said:

Exactly why nobody can compete with youtube. They don't have to be profitable, everyone else does.

In this particular case, it would probably not be in the public’s best interest to torpedo YouTube. A massive chunk of internet history would disappear, and as said, without significant financial backing, alternatives would likely involve significant compromise. 

[williamcll]

Maybe now video search on any search engines would be useful if youtube goes independent.

[Matt_in_NE]

18 hours ago, leadeater said:

Sometimes reality sucks, because that really is the situation of the matter unfortunately. When a company is legit the size of a country GDP wise they bury the issue in courts until you give up or they get "enough of a win" to agree to do whatever it is and it'll be next to nothing.

 

Google, the perfect counter argument for the right to a fair trial lol.

Again, they said the same thing about Standard Oil. 

[leadeater]

3 hours ago, Matt_in_NE said:

Again, they said the same thing about Standard Oil. 

Successful examples are very few and far between. I can name off a fairly long list of companies operating today that shouldn't have the market control they do, ISP's & Telco's being very well represented in that list.

 

I don't set my expectations by the exceptions, I simply don't see Google being forced to split in any meaningful way by a US court considering how global of a company they are in operations and infrastructure and how literally reliant as the world we are on them.

 

Even if Google loses the suit I don't see them being forced to split up. That's a very ambitious expectation in my opinion.

[CarlBar]

3 hours ago, Matt_in_NE said:

Again, they said the same thing about Standard Oil. 

 

I was thinking of the east india company myself. 

 

To us here today Google for various reasons looks like a nigh unassailable giant, but the reality is plenty of much bigger entities, (in terms of global importance and influence at the time of their demise), have fallen. the reality is for all it's wealth and influence google is highly reliant on not making itself a bigger problem for someone than it's worth in what it gives them. The US is the big one, but there are a number of other nations or groups of nations with either enough international or at least business level influence that could cause it real strife.

 

At the risk of getting into politics, one of the big "dangers" that could result in the spark for another big war is a big multi-national getting caught in the gears of diplomacy. The danger with being big and important is that people want to control you, cut you down, or prop you up all for their own goals.And that creates conditions for a spark, or for the entity in question to get smashed up in the kerfuffle.

[05032-Mendicant-Bias]

IMO, If it's got to the point that breaking google is impossible because google is too big to fail and is a single point of failure for many other systems, it should have been broken up a while ago, but that's my "not wanting megacorps to overpower governments" side speaking.

 

Honestly, I think youtube should become a public service paid by taxpayer's money at this point. So much knowledge, information and history is now stored in it.

 

Realistically, I don't think the USA would damage one of its tech cornerstones. Youtube is being sustained by other google's companies that actually make money.

[Gamer Schnitzel]

The only people that can stand up to Google is the EU. If America knows what's good for them they would invite the European Court of Justice and give them jurisdiction over Google.