Google says it doesn't monopolize digital ad market – senators don't buy it

Let me make it really simple: The problem with the tech industry is vertical monopoly, but many people want to just think about horizontal monopoly.

EU courts have arrived at similar conclusions re: Adwords. Specifically, they found that adwords does this sort of thing to its "search partners," competitors to google monetising via Adwords.

Google fought it, lost it, and then took its puny (in google terms) $1.5bn fine as a (affordable) cost of doing business. They certainly would have be happy to pay more than this for the gains they made by operating this way.

The issue with Antitrust as it is, is that the "crime" requires active proof and specificity. Essentially, the (practically) inevitable side effects of market dominance. You might need to prove specific violations like price fixing or (like with Adwords, Amazon and other current cases) using market data to gain an edge as a participant. You might need to prove market dominance by "proving" price effects and other microeconomic effects.

The problem is, these are hard to prove. You certainly can't prove all of them. But, they are a problem to the extent that monopolies exist. An occasional, multi year case ending in a fine It doesn't help that software economics are very different, and that a lot of both theory and legislation practically assumes that the "market" is commodity-like. It just so happens that dominating literal "marketplaces" like adwords, amazon marketplace, etc. is an area with precedents.

Meanwhile, it's not like we particularly care if the adwords marketplace is efficient. There is simultaneously a massive public interest in 2020 monopolies, ooh. Otoh, the cases that prosecutors are making are very disconnected from the actual public interest. The public isn't all that interested in ad marketplaces being "better," cheaper or whatnot.

Strong disagree, it's a terrible question, most likely not entirely factual, and there's no reason to dignify it with an in depth answer as it would require breaking down multiple company's ad ecosystems for one question. You're re-interpreting the question as something he didn't actually say. The question, as it is in the official record is "how does that show up on a 7 year old's iPhone".

> Senator, ad providers have little control over what the content of the ads that are going into these applications is.

This isn't really true, and also if interpreted in the most negative way it can be, this is opening up a big can of worms that isn't true. To say that they have little control over whether an ad somehow finds a picture of your grandfather and shows it to you is just straight up false. The only ad network where this is possible is Facebook and the advertisers do not get access to those images or know what names they are using to affiliate with their ads. Only that they can show names from a user's friends list.

I still think the most likely assumption is that the ad showed an old man and the 7 year old assumes any elderly man is her grandpa, or that the congressman made up the scenario based on something similar happening (seeing an ad in a facebook feed with a photo of the grandpa). It's a combative question and deserves a combative answer.

It's like when my mom calls me to say her iPhone is showing an error on the screen, but she can't remember what it was. So I ask her to write it down on a piece of paper and then call me next time it happens. It is always

"A new version of iOS is available for your device. Press OK to upgrade to iOS x.x.x."

Edit: If they were chatting at the bar about how ad networks work, it's one thing. But this is a congressional hearing and there's no reason you should need to potentially implicate yourself on a situation that doesn't even exist.

> Antitrust doesn't exist to protect competitors from competition

That's in America. In Europe, it actually does.

> Most tech companies are natural monopolies...

What? Why? ISPs like Bell are "natural monopolies" because last-mile right of way is expensive and digging up the same street 10 times to lay 10 different lines is hugely redundant. There's nothing natural about Google's monopoly in advertising, Google just acquired most of their major competitors.