What you need to know
- It is said that Google has offered some concessions to thwart a potential antitrust lawsuit by the Department of Justice.
- The company is said to be offering to split parts of its ad technology business into a separate company under Alphabet.
- However, the US government may prefer to sell assets over Google franchises.
Google may be feeling pressure from the US government’s crackdown on its advertising technology business. The company has reportedly made some concessions in an effort to avoid a potential antitrust lawsuit from the US Department of Justice targeting its digital ad technology platform.
according to The Wall Street Journal (Opens in a new tab)Google is proposing to separate parts of its ad technology business into a new subsidiary of Alphabet, the parent company. This means that the search giant is simply offering to move the money by reorganizing this business as a new subsidiary within the same organization.
Google’s supposed concessions come a few months after some US senators planned to introduce a new bill targeting its ad technology platform. Senator Mike Lee of Utah supposedly led efforts to break the stranglehold of Google and other tech giants in the digital advertising market.
The bipartisan bill was said to be targeting Google’s businesses that do auctions and serve ads on the web and apps. The US government has been cracking down on how Google is working on that front as it participates in auctions run by its own platform. Google’s massive advertising business has also been scrutinized by EU antitrust regulators.
In the US, regulators are concerned that the Mountain View-based giant may favor its own business over competitors. The law was supposed to prevent Google and other tech giants from controlling multiple parts of the digital ad supply chain.
However, it remains to be seen whether the Department of Justice will accept Google’s concessions or require the company to sell parts of its ad technology platform. The Wall Street Journal reports that the US government appears to prefer the latter over the former.
It is uncertain whether Google will agree to sell its ad technology business. Late last year, the company announced a 41% increase in the third quarter of 2021 over the same period a year earlier. The growth was driven by advertising.
Android Central has contacted Google for comment and will update this article as soon as we receive a response.