The Government Goes After Google Again

A suit attempting to break up the company’s ad-tech business may be its most serious legal threat in years

- Julia Love and Davey Alba, with Leah Nylen

Legal pressure has been mounting on Alphabet Inc.'s Google for years, making a large showdown over the company's market power seem increasingly unavoidable. A new lawsuit in which the government claims that the company is illegally monopolizing the advertising-technology business and needs to be broken up has the potential to be the main event.

A good way to think about the case, according to the prosecutors who filed it, is to see it as an effort to reverse a process kicked off with Google's 2007 announcement that it was spending $3.1 billion to buy an ad-tech startup named DoubleClick. That deal, the US Department of Justice and eight states argue in the complaint they filed on Jan. 24, "was a first step in Google's march to monopoly." Google is now a ubiquitous presence in the ad-tech industry; it offers leading products for both advertisers and publishers, and its ads appear on websites across the internet. This was not a foregone conclusion 16 years ago. At the time, Google used its burgeoning ad business to place ads next to results on its own search engine. But it was struggling to launch a technology known as an ad server, which would allow it to place ads on other websites, according to the lawsuit. It also faced an uphill battle in building relationships with top advertisers.