Speaker 1: Also media.
Speaker 2: Hello and welcome to Better Offline. I'm your host ed Zitron.
Speaker 2: Once again, we are here to talk about the Department
Speaker 2: of Justices case against Google Ads. Today, of course, I'm
Speaker 2: joined by Jason Kint, the CEO of DCN. We've got
Speaker 2: a special guest as well, Ariel Garcia, director of Intelligence
Speaker 2: to ad Transparency nonprofit Check My Ads. Ariel, Jason, thank
Speaker 2: you so much for joining me, Thanks for having us. Likewise,
Speaker 2: so Aria, why don't you tell me a little bit
Speaker 2: about the end of the Department of Justices case. Anything fun,
Speaker 2: interesting or scandalous happened in the last week.
Speaker 1: Yeah, I will say it was definitely a markedly slower
Speaker 1: week than it was last week. A lot of the
Speaker 1: testimony that we heard was simply for the purpose of
Speaker 1: getting exhibits into evidence, but there were a couple of
Speaker 1: things that stood out. We started the week with Neil
Speaker 1: Mohan and the big revelation.
Speaker 2: There who is Neil Mohan?
Speaker 1: Well, he is now CEO of YouTube, but he came
Speaker 1: over with the Double Click acquisition, and so what one
Speaker 1: of the big focus areas of his testimony was about
Speaker 1: the ad meld Yield Manager acquisition, and we saw internal
Speaker 1: decks where they were discussing whether or not to purchase
Speaker 1: and a yield manager.
Speaker 2: And what does that mean as well?
Speaker 1: So it basically helped publishers optimize yield. Jason, you can
Speaker 1: probably add more color to this than I can. Like, Okay,
Speaker 1: now there is one important point. There's two kind of
Speaker 1: component functionalities that ad meld had. One was the yield
Speaker 1: management functionality and the other was real time bidding, right.
Speaker 2: And just clear, yield management is managing the amount of
Speaker 2: money you make from your ads.
Speaker 1: Yeah, it is. Like I said, I'm not on the
Speaker 1: publisher side, so I don't know that I've never worked
Speaker 1: in one, but I can I can certainly talk Google ads.
Speaker 1: But anyway, what Google did when it ultimately did buy
Speaker 1: ad meld was kill the real time bidding bit. But
Speaker 1: we'll get to that. So we see a deck where
Speaker 1: they're debating whether a yield manager would be a good
Speaker 1: investment to make, and it says in the deck that
Speaker 1: their tech is irrelevant to Google. And then we see
Speaker 1: that they paid I don't remember the exact number, but
Speaker 1: I think it was like one hundred million over the valuation.
Speaker 1: And before that, we see an internal exchange where Neil
Speaker 1: says something to the effect of, well, we could just
Speaker 1: buy it and park it somewhere. So they were upset
Speaker 1: that yield managers were starting to gain traction. It ran
Speaker 1: the risk of disintermediating DFP, and obviously that would cause
Speaker 1: risk to revenue through add X, which was very, very
Speaker 1: profitable for them.
Speaker 2: So just break it down in simple terms for a
Speaker 2: simpleton talking about myself here. So by killing off this product,
Speaker 2: this yield management company, it means that they would stop
Speaker 2: people being able to optimize how much they make. What
Speaker 2: are the ramifications of doing this.
Speaker 1: Well, remember that it came with the real time bidding
Speaker 1: functionality as well. So what this was really about was
Speaker 1: two things. It was to again protect their addex revenue,
Speaker 1: but also to make sure that DFPS that double click
Speaker 1: for publishers stays critical. And so what they did was
Speaker 1: they took it in. They built in some of the
Speaker 1: core yield management functionality into DFP. They integrated that, but
Speaker 1: they got rid of real time bidding so that they
Speaker 1: can keep you know, restricting and setting the rules for
Speaker 1: the auction on their side.
Speaker 2: Oh, so they deliberately killed a useful product that they
Speaker 2: owned as a means of as a means of making
Speaker 2: the product worse so that they would make more money.
Speaker 3: And they didn't kill it, they parked it. And then
Speaker 3: we had Neil try to explain that park didn't really
Speaker 3: mean what we all thought it meant. It just right
Speaker 3: to continue to operate it status quo for now.
Speaker 2: That classic word park that I use to refer to
Speaker 2: operating something and using it. That's why it's called the
Speaker 2: car park, and you drive on it exactly.
Speaker 1: It's like, so we hear something else very similar. While
Speaker 1: we're on that topic. The other one of the other
Speaker 1: spicy things that happened was we heard from Jonathan Bellach yesterday.
Speaker 1: He's another longtime now ex Google employee that came over
Speaker 1: with the Double Click acquisition, and with him they were
Speaker 1: talking about exchange bidding, which was basically the product that
Speaker 1: Google launched to kill header bidding. And we see an
Speaker 1: email about how their goal is to make exchange bidding
Speaker 1: slightly better than header bidding.
Speaker 2: So the deoder bidding is the open source at network approach.
Speaker 1: That's correct, so well, not add network, but like header
Speaker 1: bidding rapper, it allows them to bid without like Google
Speaker 1: getting first looked. It enabled a fair auction, right.
Speaker 2: Oh, Google will never have that then.
Speaker 1: So what we see is that their goal was to
Speaker 1: roll out a exchange bidding so that it's slightly better
Speaker 1: than header bidding, and the DOJ asks, Uh, Bellak, why
Speaker 1: slightly better? And he explains the context as his goal
Speaker 1: was for his team to roll out a product that
Speaker 1: is as much better than header bidding as possible, but
Speaker 1: the direction from leadership was to scale it back to
Speaker 1: only slightly better, And the DOJ asked him why that
Speaker 1: is is it was it because they wanted to protect
Speaker 1: the ad X revenue and he said something to the
Speaker 1: effect of you're gonna have to ask leadership about that.
Speaker 1: So that was another interesting one, right about how they
Speaker 1: like intentionally. Oh and by this point they also mentioned
Speaker 1: that header bidding innovation had continued and so by this
Speaker 1: point exchange bidding would be inferior. Right, So that was
Speaker 1: certainly interesting and also told like a bit of a
Speaker 1: more nuanced story about the fact that even if the
Speaker 1: product organization wanted to do right by their publisher customers,
Speaker 1: they were hamstrung by leadership.
Speaker 2: That's very good. I think that's what we say. It
Speaker 2: does feel like this. I don't think there's any open
Speaker 2: and shotcase and anything like this. But it does feel
Speaker 2: like Google's egregiously taken the piss in a lot of this,
Speaker 2: in a lot of these scenarios. That feels like there's
Speaker 2: been a lot of testimony and discovery that's just them saying,
Speaker 2: what if we made it so that no one else
Speaker 2: could do this and we would make more money than
Speaker 2: them through monopolis, Like it feels almost two on the nose.
Speaker 1: Yeah, no, that's fair. And then I'll save my last
Speaker 1: one big highlight that is one that not too many
Speaker 1: other people are talking about, so I'm making sure to
Speaker 1: talk about it all the time. So during Brian o'kelly's
Speaker 1: deposition tape, he used to be CEO of Upnexus, now
Speaker 1: he is CEO of Scope three. During the end of
Speaker 1: his deposition tape, he talks about how pre Bid, which
Speaker 1: is the open source thing that we were talking about
Speaker 1: before kind of pre bid was brought to IAB tech
Speaker 1: Lab that typically will govern like open source standards and
Speaker 1: stuff like that. They wanted tech Lab to take over
Speaker 1: the governance of the pre bid standards and IAB tech
Speaker 1: Lab rejected it. Why because Google vehemently objected. Obviously they
Speaker 1: were worried about the thread at post to them, and
Speaker 1: so that's why Prebid became its own separate nonprofit. So
Speaker 1: we also Brian flags that Google at the time at
Speaker 1: least was the biggest financial contributor to IAB.
Speaker 2: And what is IAB just for the.
Speaker 1: Listeners Interactive Advertising Bureau. The tech Lab is a separate entity.
Speaker 1: To be clear, there is some overlapping governance, but I
Speaker 1: just don't I know that there will be a barrage
Speaker 1: of people that say they're separate. So I am acknowledging
Speaker 1: they are separate entities, but there is overlapping governance. The
Speaker 1: IAB Tech Lab has a lot of standards, like they
Speaker 1: have the open RTV standards. IAB itself has its own
Speaker 1: standards or frameworks that it oversees. But in terms of
Speaker 1: like the technical standards, that's that's under the IB tech Lab.
Speaker 2: So the the kind of like a professional association for
Speaker 2: the ADS industry or did you ads?
Speaker 3: Yeah, ads, ad tech, etcetera. I mean this one just
Speaker 3: to jump in this one to be fair, I was
Speaker 3: I was not in the courtroom when they read this
Speaker 3: one in when they show this deposition, so I saw
Speaker 3: the news report on it in at exchange, I think,
Speaker 3: but you know this is a situation where app Nexus,
Speaker 3: the largest independent ad tech company out there besides Google
Speaker 3: at the time, you know, had this open source code
Speaker 3: that they developed with other players to open up the
Speaker 3: auctions and create a fair environment against Google. And the
Speaker 3: report is and what Brian O'Kelly, the CEO, testified Undrowth
Speaker 3: is that, yeah, that they had this and they want
Speaker 3: to donate it to the industry. Right, So you got
Speaker 3: this industry association that's supposed to be for the betterment
Speaker 3: of the entire industry, and one company's interests weighed in
Speaker 3: heavier than the rest of the entire industry, which is,
Speaker 3: you know, a very clear symptom of the problem we're
Speaker 3: talking through in all these lawsuits, right, is that one
Speaker 3: company's interests outweigh everybody else and they just continue to
Speaker 3: gain more and more market share. So it's very that's
Speaker 3: very concerning. I didn't shed like good light on IAB either, frankly.
Speaker 2: So it feels like we are at this point in
Speaker 2: the ads industry where things are. If Google is broken
Speaker 2: up in the way they're suggesting, it's going to have
Speaker 2: more ramifications than just for Google. It feels like there
Speaker 2: are organizational shifts that will have to happen as a result.
Speaker 2: That's right, those who have aligned with them at.
Speaker 3: Least, that's right. And I think in a moment like this,
Speaker 3: because we are geting you this moment frankly between the
Speaker 3: search opinion and now this trial where it seems to
Speaker 3: be headed, sometimes it's hard to think through what this
Speaker 3: means and the collateral damage, and people worry about the negative,
Speaker 3: but it also creates a lot of opportunity, right, and
Speaker 3: so it unlocks and creates oxygen for everybody. And that's
Speaker 3: that's the that's the fun part.
Speaker 2: So have we had anything more about Jedi Blue, Jedi Blue,
Speaker 2: the Facebook Google deal? The is a big deal or
Speaker 2: isn't a big deal, depending on who you ask.
Speaker 3: I looked at Texas and Q one him next year.
Speaker 2: That is that where the suits are happening.
Speaker 3: That's where the state ag suit is, and that's where
Speaker 3: they were able to depose so Narbashi and they were
Speaker 3: able to depose the Facebook witness. It's come up in
Speaker 3: a few different ways and its it continues even today
Speaker 3: where you know where they are trying to bring Facebook
Speaker 3: in as a competitor in this relevant market that this
Speaker 3: suits all about. And you start to it's the threat
Speaker 3: of Facebook coming into the market. But the rest of
Speaker 3: that story is that Facebook didn't really come into the
Speaker 3: market because they had a sweetheart deal with Google to
Speaker 3: not come into the market, right, And so we're not
Speaker 3: telling the rest of the story right now, And I
Speaker 3: think it's because the US Department maybe doesn't need to
Speaker 3: tell the whole story. They already have enough. But but
Speaker 3: I don't know if you have a different read aerial.
Speaker 1: No, I think that's right. I mean, you're exactly right
Speaker 1: that it came up like once, But I also agree
Speaker 1: that's part of the contortion that they're doing. Then the
Speaker 1: other part of the contortion is still like the market
Speaker 1: definition contortion. Like just just today, at the very end,
Speaker 1: and they were they were going through we started to
Speaker 1: hear from a Microsoft employee Beneezer, I'm bla. I think
Speaker 1: it was is it Ben Jon? That's it was Ben Jon,
Speaker 1: And they were talking about how Xander had helped Microsoft
Speaker 1: gain a foothold in ad tech. But if you actually
Speaker 1: read the document's Google was pointing us to, it was
Speaker 1: talking about how Xander invested in video. So we're still ignoring,
Speaker 1: we're still ignoring the display market. And they're like systematic
Speaker 1: control of it. They're just kind of pointing to all
Speaker 1: of the other areas that that they that they haven't
Speaker 1: yet taken completely over just yet.
Speaker 2: Well that kind of leads us to the next part.
Speaker 2: So it sounds like that we're recording Friday, September twentye
Speaker 2: My iPhone has still not arrived. So Google is now
Speaker 2: on the stand. So walk me through it, jas, wonn't
Speaker 2: you stont sure?
Speaker 3: So they bring up their first witness, who we don't
Speaker 3: know a lot about because he seems to have disappeared
Speaker 3: off the internet, but he's been there for nearly two
Speaker 3: decades and he's one of the few people that didn't
Speaker 3: leave when the lawsuit was filed. And you know, most
Speaker 3: of the Google led defense, the Google attorneys were focused on,
Speaker 3: I think two things. One was having him draw out
Speaker 3: on a visual the entire ad tech supply chain and
Speaker 3: all of Google's components of it, which you know, at
Speaker 3: first seemed to seem like a good strategy to kind
Speaker 3: of confuse the room and the judge, but I think
Speaker 3: at the end of the day it was more annoying,
Speaker 3: and it actually it just showed that they were all
Speaker 3: over the entire marketplace, right and so it was just
Speaker 3: a lot of smoking mirrors. And then the other piece
Speaker 3: was to try to bring in this element of all
Speaker 3: these different products serve other types of advertising, be it video,
Speaker 3: be it app advertising, be it native advertising in stream,
Speaker 3: and so all these different things that are not actually
Speaker 3: part of this case, to try to make advertising a
Speaker 3: larger market than it really is, to make Google look
Speaker 3: less of a major player. Right, so if you can
Speaker 3: actually bring in Facebook and TikTok, or you can bring
Speaker 3: in Netflix advertising for video, then suddenly Google's not such
Speaker 3: a big player, right. But it just didn't It didn't work.
Speaker 3: And when the Justice Department followed up, they actually just
Speaker 3: pulled up an email from this witness where he actually
Speaker 3: went through and talked about their business in those exact ways,
Speaker 3: and it really negated everything he had testified. And and
Speaker 3: you know, there are a couple kind of elements of
Speaker 3: the judge also seeming to get a little bit annoyed
Speaker 3: and kind of ready to move on.
Speaker 2: So but oh yeah, yeah, it also doesn't seem like
Speaker 2: their defense is any good. It's really it's just very
Speaker 2: weird because the Search trial, they were all piss and vinegar,
Speaker 2: They were like ready to rumble. This one, they're coming
Speaker 2: in They're like, well, look this is what we got.
Speaker 2: Our first witness, who you will see has emailed literally
Speaker 2: what we're going to claim. He isn't saying. It's just weird,
Speaker 2: like they just seem almost discombobulated.
Speaker 3: Yeah, it felt this is their first witness, right, so
Speaker 3: they needed to start strong. It did not. It was
Speaker 3: not It wasn't strong. And then I mean towards the end,
Speaker 3: just to kind of give the highlights, the two things
Speaker 3: happened one and this is when Google's attorney was up,
Speaker 3: but she wanted to bring up some more recent things,
Speaker 3: right like the trade desk one of the companies they
Speaker 3: compete with their earnings from last month. She wanted to
Speaker 3: bring up something from the earnings last month, which is,
Speaker 3: you know, a year after Discovery had closed. Like this,
Speaker 3: it's not you know, it's like a very clear objection
Speaker 3: for the justice.
Speaker 2: And that's yeah, that's like something you kind of just
Speaker 2: kind of.
Speaker 3: Keeping like exhibit. It's non exhibit. It's never been you know,
Speaker 3: asked about, it wasn't part of the deposition. It's literally
Speaker 3: from a month ago. And they wanted to bring up
Speaker 3: a deal that they've done with Twitter from the last
Speaker 3: few months, right, And so the judge was like, you
Speaker 3: know this stuff is not you know, it's too early.
Speaker 3: She said something like, plus it's tainted, like once all
Speaker 3: the lawsuits started being filed, like all this stuff is tainted,
Speaker 3: you're giving me And so that was interesting. And then
Speaker 3: she said, and you're also talking about this entire ad
Speaker 3: tech ecosystem and that feels more like something for remedies
Speaker 3: rather than liability. So she was saying, like, let's talk
Speaker 3: about this when we start to break you up, or.
Speaker 2: We won't come back to this.
Speaker 3: We'll come back to this when we So everybody in
Speaker 3: the court kind of looked at each other and made
Speaker 3: their notes. But I know at the same time, you know,
Speaker 3: I don't know if that's definitely a leading in care
Speaker 3: where she's going, but it got our attention.
Speaker 2: So have you have you seen anything solid from Google? Like,
Speaker 2: have they had any wins so far? No?
Speaker 1: Like, it sounds like it sounds like I am saying
Speaker 1: that because I want to believe it and not because no.
Speaker 2: No, I truly don't think you like that. I wouldn't
Speaker 2: bring anyone on who is just like we. I may
Speaker 2: want them to lose, but I want them to lose properly.
Speaker 1: Yeah, no, since sincerely they do not have a strong argument.
Speaker 1: The fact that their their first witness landed with the
Speaker 1: judge as though they were trying to basically say, well,
Speaker 1: wouldn't it be like super complicated to blow us up
Speaker 1: if that's your best argument, like what you know? And
Speaker 1: then the fact that that that again first witness, and
Speaker 1: it felt a little bit like they were resorting to
Speaker 1: tricks and bringing in documents that weren't part of discovery
Speaker 1: and that that haven't been asked about. It's not, it
Speaker 1: just wasn't. It was not a strong way to start.
Speaker 1: They also their their ad Tech spaghetti football situation. The
Speaker 1: d o J went up there and they're like, okay, can.
Speaker 2: You explain what that is?
Speaker 3: Okay, so it was that was the judge's description. So cool.
Speaker 1: So they bring up a gray oval on on the screen,
Speaker 1: like a ball shaped oval, and then they ask him
Speaker 1: to start mapping out the ecosystem and he puts they
Speaker 1: put ad Tech ecosystem at the top. They put like
Speaker 1: buy side on the right, uh, cell side on the left,
Speaker 1: and then he starts populating it with with Google products first,
Speaker 1: and it's all Google products. So it's like okay, like,
Speaker 1: let's start with search and O and O and then
Speaker 1: like like they golled ad sense for content, ad sense
Speaker 1: for search. They go in order and they explain the
Speaker 1: history of why they're absolutely everywhere, and then like there's
Speaker 1: so now by this point and they met they draw
Speaker 1: lines connecting everything. So at this point it's a mangled
Speaker 1: mess of Google logos and unnamed alleged competitors Like so
Speaker 1: it was, Yeah, it was like a big bowl of
Speaker 1: ad tech spaghetti where Google is the is the meat
Speaker 1: balls absolutely everywhere and some competitor flex are in there
Speaker 1: a seasoning. It was, it was, And then the DOJ
Speaker 1: gets up and they're like, first of all, we need
Speaker 1: to preserve this because we're going to come back to it.
Speaker 1: So they preserve that.
Speaker 3: Thank you.
Speaker 2: The way the.
Speaker 1: Gets up and they're like, okay, so if if if
Speaker 1: I am a publisher, if I'm Wall Street Journal and
Speaker 1: i want to sell ad inventory on my website and
Speaker 1: not and I'm not on my app, right, will search
Speaker 1: help me do that? We'll ad center search help me
Speaker 1: do that. And they go down the list one by one,
Speaker 1: removing the things that do not help them monetize display
Speaker 1: ad space on their website and we get to basically
Speaker 1: exactly where the OJ's complaint started, with the exception of
Speaker 1: because he was on the cell side, they didn't touch
Speaker 1: the DSP like they left DV three or or they
Speaker 1: got exhausted with them with this, but but we got
Speaker 1: to exactly why, Like to me, it actually would this
Speaker 1: was the best way to explain to the judge why
Speaker 1: their complaint outline the markets that it did. So in
Speaker 1: my view it kind of completely horribly backfires published anywhere.
Speaker 4: The spaghetti will yet the monstrative football I should say
Speaker 4: food was a was a theme today because even with
Speaker 4: the first witness this morning, who was the expert the
Speaker 4: last expert for the DJEE.
Speaker 3: Yeah, and Google was really trying to confuse the judge
Speaker 3: and confuse him and he was really sharp and did
Speaker 3: not fall for a lot of things that they tried
Speaker 3: to get to bite on. But well, bad pun. Sorry,
Speaker 3: but but Google's attorney was bringing up trying to bring
Speaker 3: up product differentiation, I think, and I think was at
Speaker 3: the time was trying to explain why they charged twenty
Speaker 3: percent for their att exchange for the last decade while
Speaker 3: everyone else charges a lower rate and why they could
Speaker 3: justify this higher price and it wasn't just because of
Speaker 3: monopoly maintenance, and so he was talking about differentiating higher
Speaker 3: value from lower value. I think so he brought up
Speaker 3: like he was. Well, first he brought up I think
Speaker 3: chips and gasoline at gas stations, but then he brought
Speaker 3: up the Whopper versus the Big Mac, and then he
Speaker 3: brought up coke ver Stepsi and the judge at some
Speaker 3: point interrupted and said, you must be really hungry this morning, so.
Speaker 2: You don't need the judge saying stuff like that.
Speaker 3: It's not it was. I think she was amused. She
Speaker 3: was trying to bring fun to ad tech after ten
Speaker 3: days of watching Google get tortured. So he also did.
Speaker 1: Not Chiquita bananas versus I'm like, nice, Well, at least
Speaker 1: today instead of comparing apples to oranges, they're going to
Speaker 1: do bananas to bananas. So it's progressed Jesus.
Speaker 2: So what is Google's argument? What is that actual?
Speaker 3: They just lost on market definition, They've lost on you know,
Speaker 3: they lost on confusing the judge. I think I think
Speaker 3: they're down to the maybe the two sets. It's this
Speaker 3: MX case of two side and market versus if it's
Speaker 3: one market, the whole thing versus individual markets. But I
Speaker 3: don't everybody talk to doesn't think they have a prayer
Speaker 3: there can you woke me through it?
Speaker 2: Despite its flimsiness.
Speaker 3: Well, one, I'm not an expert on the MX Supreme
Speaker 3: Court case. But if you think about a credit card
Speaker 3: transaction where on both sides it happens all at once,
Speaker 3: then there is a case that went Spring Court. I
Speaker 3: think it was Ohio versus I think it's OOMX. I'm
Speaker 3: now outside of my boundary, but this idea that it's
Speaker 3: a single market and both parties are transacting together at
Speaker 3: the same moment versus this is a market. There's clearly
Speaker 3: a byside, clearly a cult side, there's different actors on
Speaker 3: both sides, and there are companies that you know, a
Speaker 3: couple of companies that participate in multiple places just they
Speaker 3: can't really compete. So it's it's very different than a
Speaker 3: single credit card transaction.
Speaker 2: If it makes also, no, I'm pretty stupid, but something
Speaker 2: obvious here seems to be that doesn't google bit at
Speaker 2: the beginning and the end of the auction. It's right,
Speaker 2: then that really isn't one thing happening in an instant, that's.
Speaker 3: Several things, multiplaces where it comes together then into a yeah, yeah,
Speaker 3: there's and there's a bunch of different things, right. There's price,
Speaker 3: there's prices that you know when you buy from MX
Speaker 3: it's a single transaction. You don't have an auction. There's
Speaker 3: there's lots of different things here that I think just
Speaker 3: fall apart.
Speaker 1: So and they also try and make it sound like
Speaker 1: it like in order like inherently in order to serve
Speaker 1: one side, you have to also serve the other side.
Speaker 1: That is simply not the case. Like, yes, there are
Speaker 1: a few companies that have have or had before they
Speaker 1: got driven out of the market, a DSP and SSP
Speaker 1: and an ad server, right, but there are also standalone
Speaker 1: DSPs there standalone ad servers, a handful of them left, right,
Speaker 1: they're standalone exchanges. So it kind of falls apart in
Speaker 1: that way as well. But I agree that that is
Speaker 1: the only art I think. Unfortunately for them, they've put
Speaker 1: all of their eggs in that basket. The other arguments
Speaker 1: that they're making about pro competitive rationales are just very flimsy.
Speaker 1: I actually, I mean it's so I made buzzword bingo
Speaker 1: this week. I made Bingo cards and I passed them
Speaker 1: out to the press box but it's every day we hear.
Speaker 1: They're trying to convince the court that the fees for
Speaker 1: their products and their growth is justified by the better
Speaker 1: quality of their products. So they talk a big game
Speaker 1: about inventory quality and inventory curation via add acts that
Speaker 1: they vet. They vet the ad advertisers that are allowed
Speaker 1: to advertise there, They that the publishers that are allowed
Speaker 1: to monetize, and its like it just has in reality.
Speaker 1: They talk about.
Speaker 2: Real good if you don't use the Internet.
Speaker 1: They talk about spam, malware, ad fraud, brand safety. So
Speaker 1: they're trying to hold out their product as like the
Speaker 1: pinnacle of these things. The interesting thing is from the
Speaker 1: economists perspective quality is the way that they describe that
Speaker 1: Robin Lee described quality is for publishers that would be
Speaker 1: yield revenue money like that, that would be quality, and
Speaker 1: for advertisers it would be ROI. So it's a it's
Speaker 1: a lot of like chickens talking at ducks and using
Speaker 1: words to describe different different things. The other thing I
Speaker 1: would say that they're doing is they jump from perspective
Speaker 1: to perspective depending on when it's convenient, right, So if
Speaker 1: something is harming publishers, they'll talk about how it benefited advertisers,
Speaker 1: But the question here is about is about the impact
Speaker 1: of publishers. They do that all day, right, So that's
Speaker 1: the other kind of little bit of a game that
Speaker 1: they're playing. They're trying to show that where something was
Speaker 1: bad for publishers, it was good for someone else. And
Speaker 1: I think that the DOJ has done a good job
Speaker 1: of also deconstructing that through largely through their expert witness testimonies.
Speaker 3: Yeah. The one other thing I add on the pro
Speaker 3: competition because I felt like I got a taste of
Speaker 3: it at the end of today, is and there's the Google.
Speaker 3: The first witness. They were talking about the mission of
Speaker 3: Google to fund the information of the world and where
Speaker 3: that probably will go. And I saw this with a
Speaker 3: search trial and I saw the app store trial they
Speaker 3: Googled member. They lost both of those, but they tried
Speaker 3: to make an argument that all of this conduct and
Speaker 3: all this wealth that we're creating through through this Android
Speaker 3: operating system and through this ad marketplace that we create,
Speaker 3: actually helps fund this entire ecosystem. Right, So if you
Speaker 3: can argue that, you know, all the way that they're
Speaker 3: running their conduct to create a bigger ad market actually
Speaker 3: ends up driving more revenue through to publishers. Then that's
Speaker 3: they would argue that that's pro competitive even though they're
Speaker 3: taking more and more of the money over time, and
Speaker 3: and they're the one that's worth you.
Speaker 2: Know, to again through the debt thing that we talked
Speaker 2: about last time A published it dat. Yeah, that kind
Speaker 2: of very severely undermines their argument. Jason, you were at
Speaker 2: the such trial. You said, Yes, how has Google felt
Speaker 2: different between them? Is it the same attorneys? Is different attorneys?
Speaker 2: Is there? Their argument sounds much weaker at the very.
Speaker 3: Least totally different set of attorneys. And I would say
Speaker 3: that this case is more complicated, so there's a bigger
Speaker 3: opportunity to try to confuse things. Where the search case
Speaker 3: really came down to, you know, would the judge understand
Speaker 3: and when be able to prove the network effects and
Speaker 3: the importance of scale with data and then you know,
Speaker 3: is buying out the exclusive search slot is that truly
Speaker 3: exclusive or is that just a preference, et cetera. So
Speaker 3: like there's this definition of exclusively conduct anyway, so that
Speaker 3: one was more I think a matter if you had
Speaker 3: to play it out and you got to see some
Speaker 3: of the bad conduct. But it was ultimately going to
Speaker 3: be based on some legal analysis where this one. You know,
Speaker 3: the actual storytelling is really really important on both sides.
Speaker 3: And you know, to be fair, we're only a half
Speaker 3: a day into Google's defense, but it looks like the
Speaker 3: the just departments got a lot better material.
Speaker 1: So there there is one thing I was reminded of
Speaker 1: as you were talking that I'm actually curious to get
Speaker 1: your take on while we're here. I think if there
Speaker 1: were one argument that seems to be landing somewhat with
Speaker 1: the judge, it is this idea that in order to
Speaker 1: they're being asked to provide access to their customers, or
Speaker 1: they're being they're being asked to allow things that would
Speaker 1: require them to build new functionality for their tools. I
Speaker 1: don't understand how that would land, even even even if
Speaker 1: we buy that they would have to build these things
Speaker 1: like how many millions do they make in a minute.
Speaker 1: So I don't I don't really understand, but I just
Speaker 1: I say that because I know. I think today the
Speaker 1: judge did ask the expert witness, or she allowed a
Speaker 1: line of questioning to continue that seemed to indicate that
Speaker 1: this is an area that she is thinking about. So
Speaker 1: I was curious about your take.
Speaker 3: I mean, at risk of ed asked me to explain
Speaker 3: another Supreme Court decision. I think that that's trying to
Speaker 3: get at the other defense that Google try to lay
Speaker 3: out there walking in, which is this Trinco case that
Speaker 3: basically it's a refusal to deal, that a duty to deal,
Speaker 3: and does does a company have to actually enable its
Speaker 3: rivals or provide APIs or allow its rivals to use
Speaker 3: its products? But that's not really central to the case,
Speaker 3: and it's really a matter of they tied their markets
Speaker 3: together and force the customer bases to use them and
Speaker 3: so but I think that's the line of defense they're trying.
Speaker 2: To be also being discovery throughout this case, where people
Speaker 2: just talk about addicts sucking, there's that being a shitty
Speaker 2: product that sucks.
Speaker 3: It's cost twice as much and it's not as good.
Speaker 3: Because yeah, I mean, that's it's a definition of monopoly.
Speaker 2: Right, Yeah, it's it really feels like we're watching an
Speaker 2: empire crumble. It's so strange because you you look at
Speaker 2: these companies for years, it's these kind of immovable beasts,
Speaker 2: these titans that will never be broken. But when they're
Speaker 2: in front of the Department of Justice, Like I don't know, man,
Speaker 2: Like it's actually good we do this, like look at
Speaker 2: my look at my annoying drawing I did, Like what
Speaker 2: do you think? Like it's just strange, like how it
Speaker 2: was always this flimsy, really interesting to watch them have
Speaker 2: to draw it out in that spaghetti football on a
Speaker 2: screen and not be able to use any other fancy
Speaker 2: video and storytelling beyond you know, the attorney at the
Speaker 2: electron and a single visual on the wall, and you know,
Speaker 2: everybody in the courtroom is watching Google pass post it
Speaker 2: notes back and forth from its attorneys to it's cobbs
Speaker 2: people to run out the door and try to tell
Speaker 2: their story outside the courtroom because there's no TVs or
Speaker 2: you know, audio ittever one. That was one thing that
Speaker 2: you tweeted out that I'd love to talk about, though,
Speaker 2: some of the pre briefs that Google had been doing
Speaker 2: around Google Ads. I would love to talk about that,
Speaker 2: primarily fiend of the show Casey Newton, who had the
Speaker 2: Google's Google's lawyer's hand up his asshole, not literally, but
Speaker 2: he was doing ventral Chris bullshit. So there was a
Speaker 2: story towards the end of October twenty twenty. I believe
Speaker 2: where Casey Newton on Platformer I apologized was suggesting anyone's
Speaker 2: hands with anywhere near anyone's unmentionables there It's not true. However,
Speaker 2: Casey clearly he and as part of the discovery, which
Speaker 2: I will link in the episode notes, Jason, you posted this.
Speaker 2: It's they briefed a bunch of journalists, including Casey Newton,
Speaker 2: and then Casey Newton put out this piece which is like, yeah,
Speaker 2: here's why I think the Google the Google's argument against
Speaker 2: the oj Ovisa it's actually good. But also, yes, I
Speaker 2: went and chased that bad boy down. Tell me the
Speaker 2: little bit about these briefs because so I.
Speaker 3: Didn't want to call any individual because that's my job.
Speaker 3: They're they're yeah, so you know what we saw. What
Speaker 3: we saw was when the the Justice Department filed its
Speaker 3: search complaints again, which is the one they just won
Speaker 3: in August. So I, like, I tried to remind everybody
Speaker 3: that when I when I shared that thread is this
Speaker 3: is a complaint that was filed and then they lost.
Speaker 3: People lost this right, It's a winning complaint by just department.
Speaker 3: And what we saw was google systematic reaction to when
Speaker 3: that complaint was filed, and all the people that they breathed,
Speaker 3: the friends of theirs that went on air on television
Speaker 3: to defend them, the editorial boards that they pitched, that
Speaker 3: wrote pieces, and most of those pieces were all here's
Speaker 3: why the just Department has filed a lousy case. Here's
Speaker 3: why Google's going to win. Here's why, you know, people
Speaker 3: don't understand how important Google is to our world. And
Speaker 3: it turns out all those people were wrong. And you know,
Speaker 3: and when you're writing a piece like that with the
Speaker 3: high take the day the complaints filed, and I guarantee
Speaker 3: most of them never read the complaint and never saw
Speaker 3: the you know, the discovery that then came afterward. Yeah,
Speaker 3: you're bound to be wrong if you're just listening to Google.
Speaker 3: And so yeah, yeah, it's the spin machine.
Speaker 2: And I will just not not put any words in
Speaker 2: anyone's mouth other than my own case. You in October twentieth,
Speaker 2: twenty twenty. This piece is quite long. I'd say it's
Speaker 2: about fifteen hundred and two thousand words, and it talks
Speaker 2: about where the where the DOJ's case is weak for
Speaker 2: quite some time, but then at the end says he
Speaker 2: spoke with a spokesperson but it is word for word
Speaker 2: basically what they wanted him to say. It's just shameless.
Speaker 2: It's such shameful shit. Not talking specifically about Casey anymore
Speaker 2: so that you guys can say something. It just sucks
Speaker 2: because look, this case is, as we are finding over
Speaker 2: these episodes, deep and weird to pull apart, and the
Speaker 2: same as with search as well. And there's nothing wrong
Speaker 2: with showing both sides of it. But at the same time,
Speaker 2: I feel like being briefed by Google's lawyer is not
Speaker 2: actually showing both sides.
Speaker 1: That's right, I mean, that's why, that's why I'm so
Speaker 1: happy to be here throughout, even though it's obviously massively
Speaker 1: disruptive to my regularly scheduled life. But that's but that's
Speaker 1: exactly why it's so important. Google has so many resources
Speaker 1: at their disposal. They have such a well oiled spin machine,
Speaker 1: and it's very difficult to cut through the noise to
Speaker 1: give perspective on actual reality. Right, So, like, yes, I
Speaker 1: absolutely have my opinions, but it's been equally as important
Speaker 1: with this trial to give people resources to develop their
Speaker 1: own conclusions and to do their own analysis. So, like
Speaker 1: we we've been pulling the exhibits into a way that's
Speaker 1: more organized to just try and empower people to.
Speaker 2: Usv Google ads dot com. We've been hyping it in
Speaker 2: every episode is bad and work, but.
Speaker 1: Like, yes, so I absolutely love weaving in my commentary
Speaker 1: into my updates, right. But the reality is a lot
Speaker 1: of the resources on that website are just to that
Speaker 1: there are resources so that others have things to look
Speaker 1: at that aren't coming just from Google's comms team, you know.
Speaker 2: And I think the problem with Casey's peace that I
Speaker 2: am going to bang on him a little bit because
Speaker 2: he deserves it, is the I actually don't mind even
Speaker 2: if someone agreed with Google, if someone was just like
Speaker 2: I actually think this case is weak. Like Nili Pateau,
Speaker 2: who have my problems with he said it was a vacation.
Speaker 2: I don't know if I agree, but that came off
Speaker 2: as nil given an opinion, which is fine, yeah, good
Speaker 2: pr whatever, but still his opinion. What Casey did here
Speaker 2: was presented as if this was some sort of objective analysis,
Speaker 2: and I think that what frustrates me about a lot
Speaker 2: of this is you also, I don't believe objective analysis
Speaker 2: really exists. I think everything's subjective. But also if you are.
Speaker 2: If you're going to talk to Google's law talk to
Speaker 2: the Department of Justice lawyer if they'll even talk to you,
Speaker 2: and if they won't, don't talk to Google's lawyer. Yeah,
Speaker 2: because you are being influenced and Google has so much money.
Speaker 2: It's not like you are helping a pop star. It's
Speaker 2: not like you're helping your favorite author. You're helping a
Speaker 2: multi trillion dollar juggernaut that controls chunks of the world's
Speaker 2: economy and knowledge like lorn to their reputation. It's it's
Speaker 2: just it's frustrating.
Speaker 3: The also, the thing we saw them celebrate at the
Speaker 3: top of their summary, which is definitely a peeve of mine.
Speaker 3: Everybody on Twitter knows, and I feel like I've made
Speaker 3: a little bit of a dent. There is Google and
Speaker 3: Facebook does this too. Puts a blog post up that's
Speaker 3: labeled often as like news, and then they put down
Speaker 3: basically a press release, and their whole goal is to
Speaker 3: get people to share that, right, and so reporters, as
Speaker 3: soon as they post, will then share that blog post.
Speaker 3: And Google noted that half of the stories out there
Speaker 3: had links to their blog post, right, which is basically
Speaker 3: just doing their press for them and so yeah, yeah,
Speaker 3: I mean, but to be fair and flip this around
Speaker 3: in the positive, and it's where we kind of talked
Speaker 3: at the very end last episode, ED, is that because
Speaker 3: I reflected on this today, I'm sitting there in the
Speaker 3: courtroom and I'm looking and I've got two full rows
Speaker 3: in front of me of Google Comms people, two full rows.
Speaker 3: But over on the left there were also three rows
Speaker 3: of press, which we did not have in a search case.
Speaker 3: They're in the room, Bloomberg, New York Times, you know, adles,
Speaker 3: et cetera. They're all sitting there and they're hearing the
Speaker 3: exact same thing because they have to be in the room,
Speaker 3: which is kind of interesting. You know, they can't be
Speaker 3: off walking the halls. They have to be in the room.
Speaker 3: They're gonna miss it. And then RL's back in the
Speaker 3: corner too, just nailing everything down and like so it
Speaker 3: does feel like we've got actual eyes and ears in
Speaker 3: the room and getting the facts out there in a
Speaker 3: better way than the search case.
Speaker 2: And it also feels like the ad pers. I feel
Speaker 2: like the digital ad press has been like often honestly
Speaker 2: a few years where kind of worried they were going away,
Speaker 2: they've come back quite aggressively here, and I don't think anything.
Speaker 2: I don't think it's anything. If it's personal, it's just
Speaker 2: because Google's been fucking around, they're finally finding out. I
Speaker 2: don't think it's any particular agenda. But also I do
Speaker 2: challenge you listeners if you think any of this is
Speaker 2: reporters coming in with an agenda, look at the other side,
Speaker 2: Look at what the tech industry has done using the media,
Speaker 2: and look at this. We should be proud as members
Speaker 2: of the media, of the ad tech press and how
Speaker 2: they have gone about this, and how Arielle and Jason
Speaker 2: are ruining their weeks going to this courtroom. But it's
Speaker 2: great because this is an empire. In my opinion, this
Speaker 2: is his opinion that needs to fall that it needs
Speaker 2: to be fair. Why do you and I are normal
Speaker 2: people have to compete like regular people, and these rich
Speaker 2: bastards get to do more. It's just frustrating. I like
Speaker 2: seeing them burn. I'm completely subjected by the way. I
Speaker 2: do not pretend otherwise.
Speaker 3: All good, All good? It so yeah, so Google, we'll
Speaker 3: have probably about a week left of defending itself and
Speaker 3: then they'll be back to you know, maybe some rebuttals
Speaker 3: and stuff, but then it'll be to the judges. So
Speaker 3: about week left, I think yeah, I think by next Friday.
Speaker 2: Hell yeah, well I think I think we can call
Speaker 2: it there. Jason, where can people find you?
Speaker 3: Jasonderscore Kent k I N T or you can always
Speaker 3: check out Digital Content next dot org, who I work for,
Speaker 3: and all of our resources and our accounts there too,
Speaker 3: an Ariel.
Speaker 1: Ariel as Garcia or as dot org or USV googleads
Speaker 1: dot com.
Speaker 2: I'm I'm everywhere, but also genuinely USV Google Ads is
Speaker 2: so good. It is one of the best, the best
Speaker 2: things out there. And you can read all of those
Speaker 2: wonderful emails where they're just like, yeah, we love doing monopolies.
Speaker 2: Be a little bit dramatic there, but thank you so
Speaker 2: much everyone for listening. I'm of course ed Zitchron and yeah,
Speaker 2: we'll have probably another at least one more episode on
Speaker 2: this and then we can wrap it up. Thank you
Speaker 2: so much, thanks for having us by, Thank you for
Speaker 2: listening to Better Offline. The editor and composer of the
Speaker 2: Better Offline theme song is Matasowski. You can check out
Speaker 2: more of his music and audio projects at Matasowski dot com.
Speaker 2: M A T. T O. S O. W s ki
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