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New bipartisan bill aims to break up Google’s ad dominance

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More bipartisan bills are coming up in the US Congress as some lawmakers are trying to find ways of legislatively containing the enormous power that the likes of Google and Facebook have over the internet – in this instance, over the super lucrative digital ad market.

It’s no secret that there, these two giants form what’s effectively a duopoly, while their financial might relies on it, drawn from a business model crafted to continuously harvest data and track users.

According to The Information, we are now weeks away from Senator Mike Lee, a Republican, introducing a bill that aims to separate various segments of the advertising business, preventing monopolistic behavior. The report, based on unnamed sources, also said that Lee has the backing of Senator Amy Klobuchar, a Democrat who chairs the antitrust committee, and several others across the aisle.

In addition, according to the same sources, Lee is trying to garner support for a sister bill that would be introduced in the House, and is reportedly in talks with congressman David Cicilline and Ken Buck, a Democrat and a Republican, respectively.

Specifically, a company like Google – that the bill seems to be targeting – would no longer be able to both own the ad exchange, and at the same time be a middleman for buyers and sellers. The bill aims to eliminate conflict of interest and antitrust behavior, the report suggests.

Moreover, Google’s control of the ad market is seen as harmful to the traditional media industry, with several lawsuits filed by hundreds of newspapers. Google denies it is operating a monopoly.

But its current grip on the ad market – comparable, a source from Google itself said, to Goldman Sachs owning the New York Stock Exchange – means the behemoth is able to earn fees that are seen to be unfairly high.

And while fees in a stock trade worth $100,000 will reach “a few dollars” – as Notre Dame antitrust law professor Roger P. Alford said during a Senate hearing held in January – an ad campaign of the same value would bring $20,000 to Google’s exchange.

In 2020, this business added up to $147 billion, over 80% of Google’s overall revenue.

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