Google is illegally monopolizing online advertising tech, judge rules

As someone who has worked in AdTech I would respectfully disagree. It is indeed complex but it is incredibly efficient. Also it is irrelevant of whether publisher earns 75% or 30% of the total revenue. What matters is how much they are earning compared to the next best alternative.

Some companies like Google are incredible at this. Google is not a "monopoly" in this space. In fact the world has far too many Google equivalents but absolutely no one comes close to Google in generating top dollars for publishers. I am saying this after working for 10+ years competing against Google.

Perhaps Google does well for their publishers but do they do well for advertisers? Inherently it seems like it's impossible to do both because what's good for one group is bad for another. Fortunately with healthy competition we solve this problem since alternatives could be used.

But since Google is playing both sides and has so much sway over the market, they're able to manipulate things. Even if they're not manipulating things to their benefit, it's still not great to have a single party have so much control.

> it is irrelevant of whether publisher earns 75% or 30% of the total revenue

Of course it matters if a middleman is skimming off 70% of the revenue in a given market.

> it is incredibly efficient

On what planet is a loss of 70% of the resources to the matching process between buyers and sellers "incredibly efficient"?

> What matters is how much they are earning compared to the next best alternative.

Right, which is why it is illegal to prevent there from being a next best alternative via anti-competitive practices which is precisely was was proven in this trial after a detailed examination of the evidence.

Thankfully HN is finally at a stage people can come out and talk about Ad tech without being harassed or attacked.

Could you explain more on this. What do you think makes Google Ad or DoubleClick so special? And

>What matters is how much they are earning compared to the next best alternative.

Correct me if I am wrong, you are suggesting even if publisher only earns 30% of the revenue they still earn more than on other alternative platform?

It was 10 years ago when I was serious about it but I found every monetization venue other than Google was a joke. If you had the right kind of site you could make money with Adult Friend Finder but everything else paid somewhere between 0-10% what Google did and it wasn’t worth the brand destruction that usually resulted.

> the world has far too many Google equivalents

No it doesn't. As explained by the parent, Google is in a unique position w.r.t to the publishers, the sellers and the bidders.

There's a ton of very talented adtech companies out there, but they only get to play an unfair game.

It’s a two-sided market and it doesn’t have to be either/or. Google has a wide range of advertisers so it can find one that converts on your site and it has a wide range of sites so it can find ones that work for a given advertisers. Also Google has a large database and user inventory for personalization so it can find ads that convert on your site even if your site wouldn’t attract ads otherwise. the personalization economy has all sorts of ads and might be brand destroying in the case of retargeting but you see that crap everywhere whereas many Google alternatives run brand-destroying ads and pay you $0.00 after rounding.

> On what planet is a loss of 70% of the resources to the matching process between buyers and sellers "incredibly efficient"?

One where the market maker is taking up the cost of providing a market. E.g. Steam takes a 30% cut for providing the infrastructure required to distribute games. Some people/companies can do it for less but it is the best option for a majority of sellers.

If the market maker did not the seller would get more revenue but would also eat the cost directly instead of paying someone else to do it.

In theory, I agree. In practice the whole system is rotten.

* Google unilaterally changing bid mechanics raising costs 15% https://finance.yahoo.com/news/google-changed-ad-auctions-ra...

* Conversion attribution and cookie bombing fraud from both Criteo and Steelhouse https://finance.yahoo.com/news/criteo-versus-steelhouse-clic...

* Phunware click flooding fraud https://www.forbes.com/sites/augustinefou/2021/01/17/ubers-l...

* A nearly unending list of different mobile ad frauds https://www.fraud0.com/resources/ad-fraud-cases-of-the-past-...

* Viewability fraud https://www.cnbc.com/2017/01/31/procter-gamble-chief-markete...

* Session hijacking fraud https://www.buzzfeednews.com/article/craigsilverman/ad-indus...

This doesn't sound like a healthy and efficient industry. Not only do vendors clip the ticket aggressively, they divert dollars that advertisers are intending to go to quality media/real publishers, and siphon it off to fraudulent sites and apps where they generally take a higher margin.

Are you saying that serving ads costs more than running a news site?

This also neglects the fact that the programmatic market routes billions of dollars intended to be spent on real media (ad placements on real news websites etc), to fraudulent mobile apps and websites and bot traffic.

> Inherently it seems like it's impossible to do both

but that is the value of a marketplace, aligning buyers and sellers via the price mechanism

30% is a long way away from 70% and Steam are providing substantially more of a service for that cut.

Isn't this decision about Google abusing their marketplace (as all marketplace owners will inevitably do), by pushing their own stuff?

Every setup where someone makes the platform and sells stuff built on top of it is inherently abusive. You just don't know when the abuse will come and against whom.

> Perhaps Google does well for their publishers but do they do well for advertisers? Inherently it seems like it's impossible to do both because what's good for one group is bad for another.

There's certainly some tension between advertisers and publishers, in that advertiser would like to pay less and publishers would like to be paid more; but there's a lot of things an ad exchange can do that are good for both. Selecting ads to display that result in meaningful downstream conversion is good for both advertisers and publishers, because they'll both get paid and maybe something about the user getting something they want too.

Showing inappropriate and ineffective ads isn't great for the advertiser, and it might make the publisher money in the near term, but it can drive users away and tends not to be sustainable --- advertisers stop advertising in venues where they don't get results.

The value of a good ad exchange for the publisher and the advertiser is when it provides reasonable matching at a lower cost than the parties arranging advertising directly. Possibly some amount of assurances for both sides too --- the exchange should ensure the advertising code and destinations aren't going to compromise the publisher or their user and should ensure that the ads paid for are actually seen (to the degree possible). There's room for the exchange to profit from scale while still being lower cost than self-managed advertising.

You're absolutely right, publishers are picking Google with cause, but if Google prevented competition, that's not a real choice is it?

There has to be some sort of competition for markets to be efficient, and you're essentially suggesting there hasn't been a viable alternative in a decade.

It matters when monopoly forces increase the cost to publishers and thus harms them.

It can be great compared to next best and they are still harmed by illegal practices that make it worse off.

It is 'incredibly efficient' because it is incredibly good at predicting clicks, conversions, or even conversion values. Which in turn makes it efficient. Sure, there is something called "auction" there, but Sothesby's or Tattersalls generally don't have buyers bidding based on what some machine-learning prediction AI computed in a jiffy (or maybe they do these days, who knows).

I am on the purchasing side. Google is very efficient when delivering traffic especially their Max Performance product. Probably the cheapest of all platforms. So they are serving relevant ads to users who engage with the ads. This is win for me and I assume also a win for publishers who get revenue due to higher engagement.

Also users should benefit because they are getting relevant ads. Linear tv is notorious for non relevant ads like all the drug ads for conditions you don’t have. If you’re forced to see ads, wouldn’t you want ads that are relevant?

> One where the market maker is taking up the cost of providing a market

Does a landlord on a literal physical market take 30% of revenue? I find that unlikely.

How did we arrive here, where supposedly ‘efficient’ digital marketplace is a form of rent higher than actually building physical rent, and expenses on wages and materials for a typical business?

> Also it is irrelevant of whether publisher earns 75% or 30% of the total revenue. What matters is how much they are earning compared to the next best alternative.

Not if Google illegally monopolizes the market unfairly hindering 'the next best alternative'.

> Google is not a "monopoly" in this space.

You've made that comment on a post where a judge has ruled "Google is illegally monopolizing"...

> In fact the world has far too many Google equivalents but absolutely no one comes close to Google in generating top dollars for publishers.

They have not been able to compete in a fair market.

This comment has some great examples.. https://news.ycombinator.com/item?id=43719246

No, I personally want to see ads that are as irrelevant as possible. I hate getting a sales pitch forced on me, and would rather see something funny or entertaining showing off an irrelevant product in a clever way than whatever your customers want to shove in front of my eyes.

This is why I block all ads, but still appreciate super bowl commercials.

And I have discovered that this actually works on me. I like the Nike ads, so on the occasions when I buy sportswear, I have positive feelings about Nike stuff. I spend 100-10000x more on stuff that isn't sportswear, but I think Nike gets more value from me watching that ad than anyone who advertises some "relevant" SaaS product or whatnot.

There are three parties. Media Buyers, publishers and users. As a publisher, you can go with “dumb” platforms that don’t deliver quality users to media buyers because of relevancy, you’ll make less money m. Apple ad platform is 40/60 split but for media buyers, it’s not efficient so we spend less money on it. Assume publishers make less money with it as well.

We seen dumb platforms with linear tv. Go watch any TV with an antenna.

Unfortunately a lot of economic activity in general today is just money-on-money financialism. It is all just gambling and rent seeking and dishonesty. These practices are whitewashed and given various names. The one for rent-seeking is "market making".

Ad platforms too are fundamentally about letting someone perceive ROI lesser than their real ROI, for your own benefit. For me, it falls under the same category as all of the above - zero productivity endeavours.

Maybe we should go back to the previous millenium and make usury illegal. Should fix all of these problems, albeit in a nuclear fashion.

I don't think relevant ads are healthy for the many people who do not have enough self-control to resist temptation. Ads are essentially playing mindgames triggering fear/jealousy on these people to steal their money. For the people who do have self-control, they don't need other people trying to tell them what to buy.

This doesn’t make sense.

Why would any advertiser pay the same in such a scenario?

They would obviously value your attention much less on average if that was a hard limit.

That's a good argument against bad and exploitative ads.

Not all ads are necessarily bad. Eg have you ever seen an ad for an event in your town? Maybe a play or a concert you'd want to see. Those to me feel more like "public notice: thing is happening" and every once in a while I'll actually go buy tickets. But technically, those are ads, just not the kind of exploitative ad you are talking about.

A good ad informs, while leaving the decision up to you. A bad ad distracts you with garbage and/or tries to get you to indulge in your worse impulses

You phrase it like it would be a good thing to manipulate people into buying stuff they don’t need, to generate an artificial demand by exploiting others.

> If you’re forced to see ads, wouldn’t you want ads that are relevant

Thank Dog that is a false dichotomy. I am not forced to see ads, my ad blockers are effective. Back in the day I moved mountains to get MythTV working so I could dodge the ads on linear TV

I do not want those creepy greedy monkeys anywhere near my data

No. A thousand times no!

> have you ever seen an ad for an event in your town?

I get those on the local town board, online in the town group I explicitly joined, and from people around. I do not want those on a random page when I'm trying to do something else.

Competing ad/fill markets fix the problem.

Which is why market makers like Google quietly work very hard to discourage, prevent, interfere or buy their competition.

I choose option three in the false dichotomy: Render it illegal to attempt to force me to see ads.

They weren't positively received in any computer nerd spaces, at any time that I can ever recall—with the sole exception of the "non-evil", well-marked, text-only Google ads that they used to run. There was a lot of "everything except these is bad".

Now google's as bad as any of the old pop-up flash advertisers, plus they intentionally trick people into confusing ads with search results, and they're more effective at tracking people than any of those ad networks were. So there's nothing left to say anything positive about. The single arguably-good version of this entire field of Web ads is long gone.

To me that reads like endless drug ads for the disease your loved one died from 10 years ago.

It doesn't make sense financially. But money is not the only thing that matters.

My emotions matter. If I see a scary person who is not my friend, I yell "put him down" in my head, and take actions.

If that scary person knows more about me than I know about myself. I bark like a small dog. Arf! Arf! Arf! In English, that roughly translates to "Get out of my sight! Get out of my head! Then I'll feel fine again."

If this doesn't make sense to you, then you are suggesting a world where money/truth matter more than emotions. But then why do people make money, if not just to survive? Arf! Arf! Arf! (This originally translated to: "Don't engage with me unless you value low-status people")

Especially as the random page will be organized in a way to steer me towards the ad rather than the thing I want to do.

This still doesn’t make sense.

Since everyone values emotions differently... there would still need to be some intermediary, like money, for emotions to have any agreed upon value at all beyond narrow circles.

Otherwise what’s stopping, e.g. nihlists, from valuing your emotions at zero or a negative value?

"The only way to understand emotions correctly is through money" What a take.

I like the idea.

With money, we can value emotions. Since everybody has some money, everybody's emotions (outside of children) will have positive value.

Relating to my original example:

I, as a provider of PII, feel scared about my information being sold. If Google has a $100/year option to stop my PII from being spread, I would consider buying it.

However, I predict now some people feel angry. They feel Google should not be allowed to do this. They won't pay Google to stop, they will go to the govt.

Considering this problem, I wonder what is the next step we would need to do to ensure a world of positive emotions and money.

> Otherwise what’s stopping, e.g. nihlists, from valuing your emotions at zero or a negative value?

Well, I think a lot of people value my emotions negatively, especially angry people and corporations. In particular, corporations like to take money and make it time consuming for me to get a refund.

As for people, I am at peace because I cannot change my skin color, face, or personality, but I can adjust my goals to be smaller/non-overlapping.

You can always pay for service. Kagi, YouTube Premium, Reddit Premium, Spotify Premium, ProtonMail etc. Platforms needs money to run.

We need a market for emotions. Want a good laugh with your friends? That'll be $10. A moment of peace with your so? That'll be $100.

Rewards of up to $.50 for people willing to be scared to death (or, you know, moderate social media content).

Every ad on Reddit is currently from "hims" and has the message that your hair will fall out and your dick will stop working if you don't take their pills.

I was most impressed by a Google Ad that showed up if you searched for the Dutch tax office. It would only show the name "Tax office" with a free to call phone number under it. Only the hyperlink pointed at a paid number 90 cent per minute.

Depending on how busy it is or how exotic your question one can easily be on hold for an hour or two. Then you get the bill and pay 54 euro per hour.

Google thought this was a great way to make money. The ad ran forever.

Makes you wonder which other phone numbers they highjacked.

Would they provide the same service if I copy some website?

Thank You for saying this out now. Again we are finally back to may be Pre 2014 HN where we can talk a little about business and money.

It is not about ads being positive, but as a necessary evil. And we could at least discuss about the tech behind it, the performance of it without being shut down and downvoted so the whole thing disappeared.

>but it has not been for at least a decade.

Actually yes since around 2013 - 2014. HN has plenty of decent Ad discussions on both buy and sell side pre 2013 / 2014.

I worked at Google on Adtech. I can tell you everybody knew it was an unfair game and illegal.

Lots of unrecorded meetings and “no notes taken” sessions

I don't give a shit what advertisers want. I was merely pointing out to someone in the ad business that I don't want to see relevant ads when they made the statement that I do.

This is something that people in advertising say a lot, but it's generally not true. I do not want or benefit from you having "better" ad targeting - I will find your product if I want it without the sales pitch.

Your opinion is biased from the fact that you worked on "adtech". How can you justify it? You are the reason the web is bloated and lost the true idea of it a long time ago. Luckily, there are people who run pi-hole and adguard who have my utmost respect along with countless people who maintain an upto-date ad-block list

Ads are not only annoying but play an extremely crucial part on tracking you across the web. People defending google cannot seem to wrap their mind around the fact that it's one of the most lucrative way to carry out mass surveillance at scale. Paying for the service only partly avoids the service to stop giving you ads. What about the insane amount of telemetry they collect? It's a lost cause

Why does your individual opinion matter to Google (or advertisers or their markets) then?

It’s probably not even possible for decision makers to discern it from noise.

"Efficient" in the pursuit of what purpose?

Jesus. What a story! Is that even legal in Netherlands?

My individual opinion is (presumably) not unique. They also absolutely can tell who is a decision maker: around 2015, people used to serve facebook ads specifically to VCs to get investment in their startups. I'm sure targeting has only improved.

How about you and the people who want "relevant ads" opt in, and everyone else gets a sane default of not beong tracked and having dossiers compiled about them. You could even implement it with an HTTP header, maybe "Allow-Track"?

Yes, platforms need money. So why should a platform not charging its users be permitted? It's dumping. It's anti-competitive behavior unfairly disadvantaging any other business that wants to enter the market the ad platform is pretending to be in. It also creates a ton of perverse incentives.

This doesn’t make sense as a reply, it’s not relevant how many others share your opinion, because it’s not aggregations of people replying to each other on HN, but specific users.

Each user’s comment has to stand up under its own weight so to speak

Cool, yours is as irrelevant as mine. The original point stands, though: not everyone benefits from better ad targeting.

> Cool, yours is as irrelevant as mine.

So then why did you reply if you already knew your comment and the rest of the comment chain was irrelevant?

Google let similar things run in Germany that were impersonating government offices (which is illegal in multiple ways), and they never lifted a finger when the malicious ads were reported, because they still made money in the end.

The advertisers are the ones trying to claim that it's a win-win situation because people like relevant ads.

Pointing out that many people don't like relevant ads is then a significant thing to acknowledge.

You're acting like pclmulqdq brought up the idea out of nowhere, which is very much not the case.

What people think about ads does matter, and does affect the bottom line.

And it's just annoying for you to act like the dislike is just an "individual opinion" but the "people like relevant ads" claim isn't equally anecdotal.

> Are you saying that serving ads costs more than running a news site?

Serving the ads is probably much more expensive than serving the news site, since there is a ton of heavy algorithms to determine what ads to show.

Total costs for each depends on how much it costed to make the news article so is hard to say.

They didn't act alone, the paid number had to be approved by someone and the phone provider also had to accept the bill. I don't have numbers but since I know multiple people who got the strange phone bill my guess would be at least hundreds of thousands of succesful click thoughts. Some called the tax office regularly around the busiest time of the year before they got the bill and found out.

There are probably people with large phone bills who didn't notice and ones who thought the tax office was just expensive to call.

> Are you saying that serving ads costs more than running a news site?

Static text is much cheaper than dynamic content. News isn't anything that couldn't be served out of a .txt or sqlite CMS.

News providers seem wholly uninterested in providing anything better and actually competing with better content providers

I’ll be charitable, what is your actual argument?

In case you didn’t see, the user has already claimed to believe the entire comment chain is irrelevant, so your a bit late.

Assuming the content is $0

They specifically said their original point still stands, and I agree with them.

> what is your actual argument

Was it not clear? Okay I can try again.

When advertisers claim that relevant ads are something people want, that's very far from being universally true. Lots of people don't want that. Don't let them use that unsupported claim to support tracking.

Note that the desires of advertisers are not part of this particular argument. It's a simple claim and counterclaim.

How does that follow? And why is your agreement relevant either?

Anyone can have an unlimited number of irrelevant opinions that they believe to possess this or that attribute, they may even genuinely believe so, yet it doesn’t amount to anything.

Even if the claimed argument was flawless… it seems strange to put a non sequitor at the beginning.

This. $1 spent on ads at Google gets a better return for advertisers than that same $1 spent almost anywhere else. For publishers, no one generates more revenue per ad space than Google (without reputation destroying ads).