Ratko Vidakovic
AdProfs / Founder
In January of 2020, Google made the announcement that it would be fully deprecating third-party cookies in Chrome by 2022. That announcement was followed by multiple delays over the last four years. Google was even assuring everybody back in January that full deprecation was certainly going to happen in Q4 2024.
In late July, however, Google announced not just a further delay, but a major change of direction: Chrome would no longer be deprecating 100% of third-party cookies by default. Instead, the new plan was that the browser would rely on user choice to determine whether or not third-party cookies would be enabled. No details were provided about how this choice would be presented to users.
More recently, Google has been defending itself in an antitrust trial against the US Department of Justice (DOJ) for allegations related to its adtech products. Evidence from the DOJ trial, including internal emails and testimonies, revealed Google’s efforts to undermine competitors and manipulate the industry in its favor. This manipulation included attempts to kill header bidding, favor its own products, and mislead industry participants about its intentions.
The lawsuit has also raised serious questions about Google’s commitment to a fair and open adtech ecosystem. Google’s attempts to control the transition away from third-party cookies with its Privacy Sandbox initiative have been met with skepticism, criticism, and regulatory pushback.
At this point, there is a real possibility of a court-ordered breakup of Google’s adtech business, among other remedies. This breakup would have far-reaching consequences, potentially forcing Google to divest of Google Ad Manager (GAM) and other related products.
All of this raises some important questions. What happens if Google is broken up? And how should the industry prepare?
What happens if Google is broken up
The US government’s antitrust case against Google could have substantial and multifaceted effects on the adtech ecosystem.
Increased innovation and competition
Google’s dominance in the adtech space has stifled innovation. Too many companies have been forced to rely on Google’s technology instead of developing their own solutions. The potential breakup of Google, particularly separating its “Network” business, including GAM, AdSense, Google Ads, and DV360, would create opportunities for new players and technologies to emerge. This could lead to the development of alternative ad serving solutions, potentially even open-sourcing GAM itself.
The DOJ case could also force Google to change its business practices, leading to a more open and competitive adtech landscape. This shift could incentivize innovation as companies are no longer stuck simply relying on Google’s current products and standards.
Increased scrutiny, lawsuits, and potential reparations
The DOJ lawsuit has already brought to light numerous examples of anti-competitive behavior by Google, including self-preferencing, attempts to stifle competition, and manipulation of industry standards. Google’s actions, particularly its handling of third-party cookie deprecation, could lead to significant financial and legal consequences, as well as increased scrutiny.
This increased scrutiny is likely to continue, with regulators and competitors closely examining Google’s practices and plans for the future. The evidence presented in the DOJ case, including internal emails and testimonies, could also be used by other entities to bring their own legal challenges against Google or force changes in industry standards.
A guilty verdict could result in significant fines and penalties for Google, potentially reaching billions of dollars. The company may also be required to provide reparations to publishers who have been financially harmed by its anti-competitive actions. A successful case may even embolden publishers and other companies to pursue their own legal actions against Google, potentially leading to a wave of lawsuits.
Uncertainty, disruption, and shifting market dynamics
The outcome of the case remains uncertain, and we must acknowledge the possibility that Google could be cleared of all charges. Regardless of the verdict, the case is likely to cause significant disruption in the adtech market. Companies may delay investments or partnerships as they wait for the outcome before the end of the year, and the uncertainty could stifle innovation in the short term.
The case also has the potential to fundamentally shift the balance of power in the adtech ecosystem. If successful, it could significantly weaken Google’s dominance and create opportunities for other tech players to gain market share. Publishers, who have long been at a disadvantage in their dealings with Google, could gain more control over their ad inventory and revenue streams.
How the industry should prepare
The industry needs to double down on interoperability. And it needs think beyond solutions designed solely for Google’s ecosystem. Focus on building technologies and standards that enable seamless integration across various platforms and partners.
Continue to invest in product development. The era of relying on Google’s technology as a crutch is likely coming to an end. Adtech companies need to allocate resources to build robust, competitive products that can thrive in a more open market.
Active participation in industry organizations like Prebid and IAB Tech Lab will be key. These groups foster collaboration and innovation, offering a viable path to challenge Google’s dominance. A less Google-centric adtech world requires greater cooperation and information sharing across all stakeholders. And these organizations will play a crucial role in this transition.
A pivotal moment
The US government’s antitrust case against Google represents a pivotal moment for the adtech industry. The case’s outcome could have far-reaching consequences. It could lead to increased competition, innovation, and a more equitable distribution of power within the ecosystem. However, the path forward remains uncertain, and the industry should prepare for continued disruption and the possibility of significant change in the months and years to come.
The key takeaway here is that a post-Google world, while potentially beneficial in the long run, demands immediate action and a significant shift in mindset. Proactive planning, innovation, and collaboration will be crucial for survival and success.