News Corp would lose $9M over nixing 'clunky' Google advertising tools, former exec testifies
News Corp considered switching away from Googles advertising products in 2017 but decided against it after determining it would cost the company at least $9 million in lost revenue, a former executive at The Posts publisher testified Tuesday.
Google maintained a stranglehold on digital advertising despite offering tools that were clunky and slow and ignoring requests to add new features, said Stephanie Layser, who worked as an advertising technology executive at News Corp from 2017 to 2022.
Despite the issues, Googles control over the market meant that it was essentially the only service that publishers used for ad deals, according Layser, who testified during the second day of the Justice Departments blockbuster antitrust case targeting the online ad empire.
“I felt like they were holding us hostage,” said Layser.
As of 2016, News Corp earned $83.3 million in ads that were sold through digital ad tech tools, according to court documents at the non-jury trial.
The majority of the deals utilized Googles ad exchange, generating $18.4 million in revenue from advertisers active on the platform, the records showed.
While exploring a potential exit, News Corp estimated that roughly half of the $18.4 million was spent by advertisers who were exclusive to Googles network, according to documents discussed during the trial.
That meant the news giant would lose out more than $9 million if it ditched Google.
Between 70% to 80% of News Corps ad deals were done through Google tools by the end of Laysers tenure with the company in 2022, she added.
Layser’s testimony comes a day after opening arguments in which the Justice Department accused Google of maintaining a trifecta of monopolies through its control of ad tools used by both the publishers that sells ads and the advertisers that buy the space as well as the ad exchange that links the two.
The DOJs complaint alleged that Google leverages its dominance over online ad technology to siphon up to 35 cents of every dollar that flows through its systems.
Googles defense team, led by Kamala Harris adviser Karen Dunn, has argued that the DOJs case is built on a flawed understanding of how the digital ad market works and that any government intervention risks causing major harm to businesses who rely on its services.
US District Judge Leonie Brinkema will have sole discretion over the trial’s outcome. The trial is expected to last about four weeks.
The feds want Brinkema to force a breakup of Googles ad technology empire, including the divestment of its Ad Manager tool.
With Post wires
