By Lauren Feiner , a senior policy reporter at The Verge, covering the intersection of Silicon Valley and Capitol Hill. She spent 5 years covering

How Google got away with charging publishers more than anyone else

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2024-09-16 20:00:02

By Lauren Feiner , a senior policy reporter at The Verge, covering the intersection of Silicon Valley and Capitol Hill. She spent 5 years covering tech policy at CNBC, writing about antitrust, privacy, and content moderation reform.

For years, Google took the same 20 percent commission for ad transactions that ran through its platform, even though it was higher than what any other industry player charged. Executives privately worried the fee was difficult to defend. Now, the Justice Department argues it’s a key sign of Google’s monopoly over online ads.

Google’s so-called take rate took center stage on the last day of week one in the Justice Department’s second antitrust trial against Google. Citing internal Google documents and the testimony of former Google sell-side ads executive Chris LaSala, the DOJ sought to demonstrate that Google never experienced any real pricing pressure due to its unshakable dominance in the market, despite knowing its fee was higher than competitors’ and being aware of customer complaints about its tools. The trial continues this week, with YouTube CEO and former Google ads executive Neal Mohan testifying on Monday.

According to emails presented in court, Google executives wondered whether the 20 percent fee their AdX exchange charged for facilitating transactions was sustainable and worried about how they’d continue to justify it. Jonathan Bellack, another ad executive at Google, wrote in one 2018 exchange that the fee was “not long term defensible.” He also acknowledged in a different 2018 email that the fee should get in line with market value and that it “shouldn’t be double the price.”