Google warns open web advertising faces rapid decline amid breakup demands

Google LLC warned the Jap District of Virginia on September 5, 2025, that forcing divestiture of its promoting know-how would speed up the “already in fast decline” open internet show promoting market. The corporate’s 24-page memorandum argues that structural treatments would hurt publishers who presently rely upon open internet show income at a time when the market faces unprecedented transformation.

In keeping with inside Google information cited within the court docket submitting, solely 11 % of show promoting impressions bought by AdWords advertisers had been for open-web show in January 2025. This represents a dramatic decline from over 40 % in January 2019, demonstrating what Google characterizes as elementary shifts in digital promoting consumption patterns.

“The actual fact is that at the moment, the open internet is already in fast decline and Plaintiffs’ divestiture proposal would solely speed up that decline, harming publishers who presently depend on open-web show promoting income,” in keeping with Google’s submitting. The corporate argues that courts ought to keep away from intervening “to reshape an business that’s already within the midst of being reshaped by market forces.”

Linked TV promoting has emerged as what business sources describe as “the fastest-growing promoting channel within the U.S.” Main streaming suppliers together with Netflix and Disney have redirected substantial investments towards tv promoting infrastructure. Netflix launched an in-house promoting suite with Magnite partnership help, whereas Disney expanded its streaming promoting capabilities throughout a number of platforms.

Retail media promoting represents one other quickly rising sector that diverts spending from conventional open internet publishers. In keeping with the submitting, retailers “of all sizes” have made monumental investments in promoting capabilities, with $60 billion anticipated to be spent in retail media throughout 2025. Amazon invested closely in demand-side platform partnerships with TV suppliers particularly “to clobber rivals The Commerce Desk and Google in a key space of promoting.”

Synthetic intelligence continues reshaping promoting know-how at what Google witnesses characterised as “weekly” intervals. Meta has launched AI instruments with acknowledged goals of “totally automating advert creation utilizing AI,” whereas sell-side suppliers like Index Alternate have built-in generative AI to energy promoting curation capabilities. Immensely standard AI merchandise like Perplexity have begun monetizing by way of promoting, creating solely new writer classes.

In keeping with testimony cited in Google’s submitting, AI will trigger “new disruptions into the market on a weekly foundation,” making a “wild-west state of affairs” that continues to be extraordinarily tough to foretell. These technological shifts basically alter how digital commercials are created, focused, and consumed throughout all codecs and platforms.

Google’s main promoting know-how rivals have uniformly directed investments towards quickly rising codecs moderately than conventional open internet show. The Commerce Desk partnered with Spotify to launch a digital audio promoting trade, whereas Magnite expanded partnerships with Samsung Advertisements to help tv promoting capabilities. Amazon’s promoting division centered investments on streaming tv partnerships moderately than conventional internet show stock.

The corporate warns that divestiture would create perverse incentives that speed up open internet decline. In keeping with the submitting, forcing Google to divest AdX and DFP for open internet show whereas permitting continued operation of promoting instruments for different codecs would “incentivize Google to shift the assets it invests in serving open-web publishers to serving publishers who prioritize different codecs, like app and CTV.”

Publishers notably weak to those market shifts embrace conventional media firms that haven’t efficiently diversified past open internet show promoting. In keeping with the court docket’s legal responsibility opinion, open internet show promoting income stays “important” for companies together with “information, media, and different on-line publishers’ companies,” particularly citing firms “equivalent to The New York Occasions or The Wall Road Journal.”

Elimination of integration efficiencies inside Google’s promoting know-how stack would probably drive advertisers towards different codecs that present superior return on funding. “Advertisers will vote with their ft and speed up the prevailing pattern of shifting spend to non-open internet show advert codecs,” the submitting states. Automated AI-powered promoting instruments programmed to maximise efficiency would speed up this spending shift even sooner.

In keeping with PPC Land’s analysis, smaller publishers stay notably depending on open internet show income streams and lack assets to diversify into rising promoting codecs. The platform has documented how unbiased promoting know-how firms struggled to compete as market forces shifted towards built-in platforms and different stock sources.

The Washington Put up Editorial Board characterised the regulatory problem as “reshaping a market that is already being reshaped,” noting the “formidable problem” courts face when intervening in quickly remodeling know-how sectors. Google cites this evaluation to help arguments in opposition to structural intervention in periods of elementary market transformation.

Google’s behavioral treatment proposal goals to protect open internet show promoting alternatives whereas addressing anticompetitive conduct. The corporate proposes enabling publishers to entry AdX demand by way of rival advert servers and eliminating pricing restrictions that prevented publishers from optimizing income throughout a number of demand sources.

The proposed monitoring trustee construction would oversee implementation of technical integrations between Google’s merchandise and business consortium Prebid. In keeping with the submitting, these connections would give publishers selections to “use AdX with Prebid and never DFP; DFP with Prebid and never AdX; and even AdX and DFP collectively, however with Prebid sitting in between.”

Trade observers have famous the strain between preserving competitors in declining markets versus permitting pure market evolution. In keeping with previous coverage, antitrust enforcement in quickly altering know-how sectors poses distinctive challenges for courts making an attempt to steadiness aggressive considerations in opposition to innovation incentives.

European regulators reached totally different conclusions concerning the viability of behavioral treatments in digital promoting markets. In keeping with Google’s submitting, the European Fee decided that “every time a follow was detected by the business, Google subtly modified its habits in order to make it harder to detect, however with the identical goals, with the identical results.”

The treatments choice will decide whether or not courts can successfully deal with monopolization in markets present process elementary technological transformation. Publishers advocating for structural treatments argue that behavioral modifications can be inadequate to revive aggressive circumstances, whereas Google contends that divestiture would hurt the publishers such treatments intention to guard.

Market information means that conventional open internet show promoting faces everlasting structural challenges past Google’s conduct. The expansion of walled backyard platforms, streaming tv promoting, and AI-powered content material creation has created different stock sources that compete immediately with conventional internet publishers for advertiser spending.

In keeping with Google’s technical evaluation, divestiture would require “unprecedented technological mission of ripping ‘AdX’ and ‘DFP’ out of Google’s core infrastructure” that has supported these merchandise for over a decade. The ensuing merchandise would function in “international setting” with out the specialised infrastructure that presently permits environment friendly processing of “a whole lot of billions of advert requests a day.”

Timeline

Abstract

Who: Google LLC argues in opposition to divestiture calls for that may have an effect on publishers depending on open internet show promoting income, whereas the Division of Justice seeks structural treatments for promoting know-how monopolization.

What: Google contends that compelled breakup would speed up the decline of open internet show promoting already going through competitors from Linked TV, retail media, and AI-powered options which have diminished its share from 40 % to 11 % since 2019.

When: The memorandum filed September 5, 2025, precedes treatments proceedings scheduled for September 22, 2025, addressing market circumstances which have reworked for the reason that January 2023 lawsuit submitting.

The place: The Jap District of Virginia will decide treatments for Google’s promoting know-how monopoly in markets the place open internet show promoting competes with quickly rising different codecs.

Why: Google argues that divestiture would hurt publishers by eliminating promoting know-how efficiencies and accelerating advertiser migration to non-open internet codecs throughout a interval of elementary market transformation pushed by AI and streaming tv progress.

PPC Land explains

Open Net Show Promoting: Digital commercials showing on conventional web sites that customers buy by way of third-party promoting know-how instruments moderately than direct relationships. This format excludes social media platforms, engines like google, cellular functions, and streaming video companies. The market has declined from 40 % to 11 % of Google’s show promoting impressions between 2019 and 2025, reflecting elementary shifts in how shoppers entry digital content material and the way advertisers attain goal audiences.

Divestiture: The compelled sale or separation of enterprise property or subsidiaries, representing essentially the most extreme antitrust treatment accessible to courts. Google characterizes divestiture as “radical” and “excessive,” arguing it ought to be reserved for circumstances involving illegal mergers or acquisitions moderately than monopolization by way of enterprise conduct. The corporate contends that separating AdX or DFP from its built-in infrastructure would create inferior merchandise whereas harming publishers depending on present promoting know-how efficiencies.

Linked TV: Streaming tv companies and platforms that ship video content material by way of web connections moderately than conventional broadcast or cable methods. This promoting format has emerged because the fastest-growing channel in the USA, with main suppliers like Netflix, Disney, and Amazon making substantial investments in promoting capabilities. Linked TV promoting competes immediately with open internet show for advertiser budgets and has contributed to the declining share of conventional web-based promoting codecs.

AdX: Google’s promoting trade platform that facilitates real-time auctions between publishers promoting promoting stock and advertisers searching for to buy advert placements. The Jap District of Virginia discovered that Google monopolized the advert trade marketplace for open internet show promoting, with the court docket figuring out that Google used anticompetitive practices to keep up its dominant place. AdX generated vital income for Google whereas serving as a crucial element of the built-in promoting know-how stack.

Publishers: Web site operators and content material creators who monetize their digital properties by way of promoting income, notably these depending on open internet show promoting for monetary sustainability. Conventional media firms together with newspapers and digital content material suppliers face explicit vulnerability as promoting spending shifts towards different codecs like Linked TV and retail media. Publishers have been harmed by Google’s monopolistic practices in keeping with court docket findings, but additionally face declining market circumstances unbiased of antitrust violations.

DFP (DoubleClick for Publishers): Google’s writer advert server platform that helps web site operators handle, optimize, and ship promoting content material to their audiences. The court docket discovered that Google illegally tied DFP to AdX, forcing publishers to make use of each merchandise collectively to entry distinctive promoting demand. Google’s proposal would remove this tying association whereas preserving writer entry to promoting demand by way of different technical integrations with rival advert servers and business consortium Prebid.

Synthetic Intelligence: Superior computing applied sciences that automate promoting creation, concentrating on, and optimization processes throughout digital advertising and marketing platforms. AI disruption happens at what witnesses characterised as “weekly” intervals, creating unpredictable market circumstances that problem conventional regulatory approaches. Meta goals to “totally automate advert creation utilizing AI,” whereas new AI-powered publishers like Perplexity have begun monetizing by way of promoting, basically altering the aggressive panorama for conventional open internet publishers.

Retail Media: Promoting codecs supplied by retailers and e-commerce platforms that leverage buyer buy information and purchasing habits to focus on commercials. This sector expects $60 billion in spending throughout 2025, representing substantial advertiser finances that beforehand supported open internet show promoting. Amazon has invested closely in retail media capabilities to compete with conventional promoting know-how suppliers, contributing to the broader shift away from standard web-based promoting stock.

Behavioral Treatments: Antitrust aid measures that modify enterprise practices and conduct whereas preserving present company construction and possession. Google proposes behavioral treatments together with technical integrations with rival advert servers, elimination of pricing restrictions, and appointment of monitoring trustees to supervise compliance. The corporate argues these measures would restore competitors with out dismantling merchandise that hundreds of thousands of consumers depend on, whereas critics contend behavioral modifications can be inadequate given Google’s historical past of circumventing restrictions.

Market Forces: Financial and technological elements driving structural modifications in digital promoting unbiased of antitrust violations or regulatory intervention. These forces embrace shopper migration to streaming video platforms, progress of social media promoting, enlargement of retail media capabilities, and AI-powered content material creation. Google argues that courts ought to keep away from intervening in markets already present process elementary transformation, whereas regulators contend that monopolistic practices forestall pure aggressive responses to those altering circumstances.