Sep 16 2020
WASHINGTON – Sen. Mike Lee (R-UT) issued the following statement Wednesday, following Tuesday’s hearing on Google’s possible violation of the Sherman Antitrust Act:
“I was very pleased with how yesterday’s hearing went. I and the other subcommittee members all put tough questions to Google and had a mostly productive discussion, which is what we wanted to happen.
“I say mostly productive because, while the members put good questions to Google, I have to say I wasn’t satisfied with many of its answers. A lot of it felt scripted and not exactly responsive to the questions we asked. Specifically, Google’s witness was evasive about the number of competitors that really compete with Google.
“As any antitrust lawyer will tell you, it’s not the number of competitors, but their size and market share that matters. No one can compare to Google in that respect. In fact, my office has heard from publishers who do use a large number of advertising tools, but still get 99% of their ad revenue from Google. Second, Google didn’t seem to tell the whole story about its ad pricing. That pricing is not transparent; a publisher doesn’t know what an advertiser bid on a specific ad, and advertisers don’t know how much of each bid goes to the publisher. And while Google claimed its margin is competitive with other ad platforms, that doesn’t mean much if it is manipulating the auction process, to ensure that Google always wins.
“Finally, Google also didn’t seem to understand my question about what’s called 'quality-adjusted price' in antitrust parlance. That gets to the idea that advertisers may be spending less per ad, but more overall in order to achieve an actual sale.
“My takeaway from the hearing was that Google has a commanding share of every piece of the ad stack, and it appears to be using its leading market positions in search and online video to engage in tying on the advertiser side of its business, essentially forcing the vast majority of demand onto its platform. In turn, publishers are also forced to use Google’s platform because there really isn’t any other option.
“Antitrust analysis depends heavily on the facts, and we simply don’t have them all here. I am glad that the Department of Justice is seriously investigating these allegations, and hope it will pursue an appropriate remedy if necessary.”