Better Offline - How Big Tech Is Losing Their Antitrust Trials feat. Jason Kint
Episode Date: April 23, 2025Ed Zitron is joined by Jason Kint, CEO of DCN, to talk about Google's recent antitrust trial losses, Meta's FTC case, and why it should give you hope for the future. YOU CAN NOW BUY BETTER OFFLINE MER...CH! Go to https://cottonbureau.com/people/better-offline and use code FREE99 for free shipping on orders of $99 or more. You can also order a limited-edition Better Offline hat until 5/22/25! https://cottonbureau.com/p/CAGDW8/hat/better-offline-hat#/28510205/hat-unisex-dad-hat-black-100percent-cotton-adjustable Follow Jason: https://x.com/jason_kint https://www.marketingbrew.com/stories/2025/04/17/google-ad-tech-illegal-monopoly-doj https://www.npr.org/2025/04/15/nx-s1-5364789/mark-zuckerberg-meta-ftc-antitrust-trial --- LINKS: https://www.tinyurl.com/betterofflinelinks Newsletter: https://www.wheresyoured.at/ Reddit: https://www.reddit.com/r/BetterOffline/ Discord: chat.wheresyoured.at Ed's Socials: https://twitter.com/edzitron https://www.instagram.com/edzitron https://bsky.app/profile/edzitron.com https://www.threads.net/@edzitronSee omnystudio.com/listener for privacy information.
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I get on their ass. Somebody's got to do it.
This is Better Offline. I'm Ed Zittron.
Today I'm joined by the wonderful Jason Kint, who has been at the Google Ads trial
and multiple other FDC and DOJ-related trials as well.
Now, last week we have wonderful news.
The Department of Justice won their antitrust trial against Google, saying they have a monopoly over ad tech.
This is a wonderful time, and Jason, of course, last year was here for multiple episodes
with us to walk us through the trial. He was there in person. Jason, how are you doing?
I'm good. Thank you. It's good to see decisions starting to come in from the courts on what we've
been talking about. And just to be clear, Jason, as a CEO of digital content next, I did not say
at the top. It's the professional podcast run by a professional. But so walk us through what the
verdict was. This is the ad tech case against Google that was in Virginia to remind the listeners.
and it was around Google having market power and monopoly power on the buy side, the sell side, and in the exchange, and then illegally using that monopoly power.
The decision from the judge was that mostly in agreement with the plaintiffs, and it was a big win for the Justice Department who worked really hard on this case, that they have monopoly power in the exchange, so where the auctions actually happen.
and then on the publisher side with the ads server marketplace
that determines what ads land on the page
and that they illegally tied those two products together.
So the only part of the decision,
which I think Google's trying to make to be a bigger deal
than it probably is,
is that the judge did not agree
that there was this market on the buy side,
the way it was defined.
And so what does that mean in simpler terms?
In simpler terms,
it could affect where remedies,
go because there is not a finding that they illegally use monopoly power on the buy side
with advertisers buying ads.
But just they owned the technology to sell the ads and the ways in which it was
like I guess.
Yeah, they still, it's true that they have significant influence because they have the largest
player on the buy side of ads so where advertisers are actually buying the ads.
But not that they, she didn't find that they had, that there was a form legal market there that they abused.
And so as we go through remedies discussions, I think it's probably, it might be less likely that there's some sort of structural separation where they need to divest the by side too.
Although all this stuff's frankly going to get tangled together and it will be a whole new ballgame with remedies, especially with search remedies going on this week too.
So go ahead.
I was going to say, like, so what are the remedies that the Department of Justice is actually seeking here?
On the ad tech case, on this case, it's a structural separation of their roles in the ad tech marketplace.
And so that was very clear coming into the trial.
So just break it down for me though, how would they break up Google in its current form?
Is that even possible?
I mean, yes, absolutely.
In the simplest way, it would be forcing Google to divest, which probably would mean,
spinning off to its shareholders rather than selling because it's going to be such a valuable
asset.
But actually, like a separate company.
A separate company that is the ad server marketplace.
Yeah.
And in the exchange itself too.
So dumb guy question for you.
What is an ad server in this case?
Like how does this actually break down?
It's the technology that sits on the web pages or on the publisher side that actually makes
the decision on what ad to serve on the page. So when you're browsing a web page or on an app,
it's what's deciding to serve the ad. And so Google ran that themselves. They, like, they ran that
themselves so they ended up prioritizing their own ads, I'm guessing? Yes, that's the case. And so,
and, you know, in the findings, what's really interesting is that the judge very much
agreed with and understood that Google's illegal conduct in terms of, you know, and the judge,
of how they were able to manipulate auctions
in ways that probably favored them
and certainly harmed the publishers
was a part of the finding.
So yeah.
And when you say they harm the publishers,
is it just the, it wasn't possible to compete
with Google on ads because Google both made ads
and then had the platform that showed the ads to people?
You know, she hit on a number of things
that I think are gonna be super interesting in the remedy.
She hit on that Google was able to keep charging 20%
of the exchange market, so they could take 20% of every single transaction and that that price
never moved from 20% for the most part because of their monopoly power, but she also hit on
all the ways that they can manipulate the auctions, which could end up being, that's a bigger issue.
When you start thinking about the private lawsuits that are out there too, you get into,
you know, literally tens of tens of billions of dollars of potential harm to publishers
from auction manipulations.
And how were they manipulating auctions, just so we understand?
Well, the allegations were that, and what she addressed in the opinion,
were things like first look and last look,
where they actually were able to see the prices ahead of time
or at the end of the auction and make decisions based on the bids
that they uniquely were able to do.
Which is so insane that they were able to like, they basically set prices, like, get everyone to bid and then just immediately beat them.
Like, it's shocking. That's the thing. It's kind of flagrant.
So with last look, I think, you know, I think I'd hit on two things here.
One of the last look, which I think the judge very much understood, because I can remember her, you know, who was completely new to this marketplace,
she totally got why that was a issue.
When she, you know, last look, if you take to like a silent auction where you put your
little bids down in an envelope and everybody has kind of their secret bid, this would be like
Google then at the end was able to look at everybody's bid, see what the highest bid was, and
then bid higher if they wanted.
That was last look.
And there were a bunch of other things that stemmed from that.
And she really seemed to understand it, which is, it's, you know, it's nice to see.
kind of impressive to see a judge just pick up an entire subject matter like that.
I totally agree.
You know who I should be most scared, frankly, by this opinion, is if I'm Facebook or
meta who is like counting on this idea that the judge in their case doesn't know or use
social media and TikTok and Instagram, et cetera, it tells you once again that a judge that
understands the law and sits there for four weeks plus all the pretrial stuff,
and listens to the evidence can understand these issues.
And the most important ingredient, I think, was the Justice Department who really understood
the case in a way that they could dive deep and then explain it to the judge.
And they succeeded to do that.
So it kind of reminds me, so during some of the Google Ads trial things, you talked about
the spaghetti thing, where they were trying to do this kind of sleight-of-hand thing and they're
like, ah, it's too impossible to understand.
Like, it's too complex.
turned it into that ridiculous thing.
That's right. They did.
And yeah, and that tells you that that is not going to be a successful defense, is trying
to confuse a judge who has never used it or would understand ad tech.
That's not going to work.
The Justice Department succeeded in explaining it.
They kept it simple.
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So what happens next?
What are the next moves with this,
pump?
Well, a reminder, this is the
what's called the Rocket Docket,
the Virginia District,
Eastern District of Virginia.
So the judge moved really, really fast.
That's why they have that name.
This case was filed in January of 2023.
And so we got to a trial, you know, 18 months later and a decision that took, you know, frankly,
the decision took a lot longer than anyone thought it was going to take to come out.
People were starting to get nervous, but, you know, it just took time.
And she clearly wrote a really clear opinion.
And it's very, it's very easy to read through.
So that keeping in mind, I think she'll probably move fast.
They have a meeting, I think it'll be tomorrow, in terms of what's the schedule going forward for remedies.
And so I would expect the dates to all be in the next few months.
But what would the remedies be?
So they would have to break off the three part, like the ad side, they would have to break off the cell side?
Like what are they going to have to do in theory?
I realize you're just guessing.
I'm just guessing.
You know, the findings are clear enough that there's going to be structural separation.
that they're going to be pushing for, you know, how the by side gets handled is going to be really
important because a reminder, and this doesn't come out really in the proceedings as much,
but the AdTech case is downstream from the search case, and the arguments were that the reason
Google was able to dominate the by side and the cell side in AdTech was because of the monopoly power
in search, which we also have remedies now.
that started on Monday.
And so these things are going to start to swirl together.
And when you think about Google having to divest Chrome and some of the other remedies within the search case,
it's quite possible that there will be some larger settlement that will be proposed
or a larger structural separation that needs to play out between the two decisions.
So as you've been hinting at, there was the verdict last year that Google did have a monopoly over certain.
How do you think that these two things are going to play together?
You kind of got it there, but what are the ways in which this could go?
Well, the search decision was not, there were two monopolies that they were found of abused.
One was search, the other was search text ads.
So it was the ads that we see in search, which is Google's largest business, right?
And so just so I'm clear, you're saying that there's the monopoly over a search engine and then the advertising on said search engine.
Exactly. And so, and that advertising on said search, that advertising on said search engine is, is what allowed them, according to the Justice Department, to then dominate in the ad tech stack. And so I think that's the connection point between the cases and we'll also start to be a part of the discussion in the remedies. Both cases involve network effects. Both cases involve using data to maintain market power.
and to abuse it.
Right.
So the potential remedies, it sounds like,
could be almost breaking up Google into multiple different companies.
With this case,
the baby Bell's,
you know,
idea of what happened to AT&T should be much more clearly front-centered.
What happened there just for the listeners?
They divided AT&T up into pieces.
And so,
so,
you know,
not just forcing them to invest one piece of their business.
And so, you know, with the ad tech case, again, there's, you know, there's settlements that can happen.
There's appeals that will happen.
But the argument for, you know, should Google have to divest not just its advertising ad tech business, but also, you know, other areas of its business, I think becomes much stronger.
You can imagine Chrome.
You can imagine Android.
You can imagine YouTube.
Yeah.
Actually, here's a good question for you.
I know Chrome.
I'm sure many listeners know Chrome as a free browser, not really a business entity.
How does selling off Chrome meaningfully help with the monopoly situation?
Chrome, you know, Google's entire advertising business is based on targeting ads based on
signals that it, in data, that it gathers from the various ways that it can touch the user.
And so Chrome as a web browser is an incredible,
way to harvest data about how you're browsing the web and where you are, location, search,
etc. And so, you know, where Google believes it has permission to use that data to target ads
and train into its machine learning and AI training, that is very valuable.
I didn't, so wait, so this is perhaps I'm very stupid. So Chrome collects data on your browsing
habits for every user. Not for every user. There's privacy, you know, settings and all sorts
of things you can do. You can go into incognito mode. But if Google is acting as your browser,
it has access to your browsing history and what you're doing on the web. And they can,
where they believe they have the rights, they can use that data to help, you know, provide further
information on both, both for search, but also for, you know, what content to serve up and what adds to
serve up. What they're actually doing becomes a bigger question. Right. So was that not was that
established a whole trial? Not it was in the search in the search case that but it was more
specifically focused on the default settings for for search from the browser right. And so
within Chrome if you type in your location bar, you're always going to be doing a Google search.
That's it's pretty clear that how that right then gets passed from the browser.
to the search engine.
Yeah, and if they have billions of users,
then everyone is searching using Google
because they have because it's the default.
That's so crazy.
But the thing with Chrome as well is it isn't a revenue driver, is it?
Like a direct source of revenue.
For Google, you know, it's, if you,
if you think about the search case again,
I mean, Google was paying Apple, you know, $25 billion,
let's say I'm estimating 20 was, it was 20 billion a few years ago.
But let's say $25 billion they were paying to Apple to be the default search on Safari and all of the access points on iOS.
So Chrome technically is making revenue off of those search queries.
It's just Google's paying itself, right?
And so that's the issue.
Well, the reason I bring that up is one of the remedies, the idea of selling Chrome off.
Why would you, like what value would there be in Chrome if the whole value of it is to just be kind of,
a flume towards Google, like a kind of like a way to, like almost like a marketing arm of Google.
If you sold off Chrome, surely it wouldn't have as much business value.
It wouldn't have as much business value to Google.
The whole point would be it'd be an independent business that would be making decisions.
I mean, technically a browser is supposed to be a user agent.
It's supposed to be making decisions for the user and what they value, right?
So a new Chrome.
I just mean as an autonomous business.
Because right now it's not like people pay for credit.
It just doesn't feel like that is a practical thing to do.
Because if the whole value proposition of it is that it's a free product that makes Google money
and it doesn't make any money for anyone else or like it isn't.
You know what I mean?
Yeah.
So it could make a decision to point to, you know, a new Amazon search site or a-
Sure.
Or somebody else that gets into search, right?
And so get paid for it.
Right.
Yeah.
I mean, it almost feels like this could lead to, I'm not going to say the death of Google in the sense that Google will cease to be, but the death of modern Googles, we know it.
It definitely all leads towards a very different Google, whether it be structurally different or just being hamstrung by the appeals of all these cases.
So, I mean, it's, I cannot think of anyone who got more lucky than it being Good Friday than Google right now.
because it's good, we're recording this on Good Friday and it's like they didn't, like the markets are
closed so they didn't immediately get the markets just pummeling them as they should.
Because they've lost both now. They don't, like whatever appeals they may do are not going to really,
I don't think they're going to stop everything.
Markets are complex. I would hesitate to wonder, you know, to predict why the stock did what it did
yesterday even when the announcement came out. You know, there are some arguments that.
having to divest, you know, divest parts of the business could actually create more value back to
shareholders. What value would that be? Well, typically when you spin things off, you often see
or you sell things, often the stock, you know, can go up because of that. And so, you know,
are the, is the sum of the parts worth more than the whole, you know, those questions all come
into play. But that's all, yeah, that's all up to the markets. And sometimes the markets aren't as
smart as we think they are and they take time to understand and unpack things.
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Is there anything to the idea that because you're,
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You only got in
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Yeah, I agree and I've seen the same thing with CoreWeave recently, which is a company that has driven me insane.
On to more sane things, though.
So we're recording this, it's going to be next week.
But the beginning of the remedies for the search trial is on the 21st.
So what can people expect there?
I don't think there's going to be as much excitement and drama as we saw with the actual liabilities trial.
I think, you know, for the folks that follow the industry closely, what you should expect is all the AI companies are involved.
And so either through depositions, discovery, and some testifying.
So you've got anthropic, open AI, might.
Microsoft. So when you think about the shaping of the AI world going forward, you're going to have all the major players. Apple is, Apple tried to actually intervene and, but the judge didn't allow them. So they've, they've got a strong interest because they've got estimated to be, I think, 10 to 15% of their profits are tied to their Google deal.
Right. And so, what, because Google pays them to use. Just so, just for the listeners.
So Google pays Apple billions to be the default search, right?
That's right.
And the remedies are that they can't do that anymore.
And so the reason they weren't allowed to intervene, according to Judge Meadow,
was because he didn't see a difference in Apple's interests from Google's interests.
He basically said, you have the same interest.
Yeah.
Well, I mean, the interest being that Apple needs Google to keep their monopoly
so that Apple can keep getting a chunk of their revenue.
That's exactly right.
Yeah, so, yeah, so Apple cares a lot, Microsoft cares a lot, all the big players care.
The testimonies is going to be a lot of experts and, you know, less CEOs.
Who will be doing the testimonies?
It'll be experts from both sides, like, so academics that study these issues.
It will be executives from the AI companies.
I think we'll probably hear from Eddie Q, again, at Apple, who's,
one of their top executives, we'll probably hear from Sundarpa Shai, again, from Google as CEO.
They're on the list.
And so in those two weeks, what's going to happen?
So it's basically another trial to say how they will deal with their monopoly in search.
That's right.
And I mean, I guess one thing that's interesting is they're still pretty far apart.
So Google's proposed remedies for itself are basically a slap on the wrist and, you know, kind of embarrassing for anybody that studies these things.
So when you say slap on the wrist, is it like a fine they're offering?
No.
What is Google offering them?
They're offering some restrictions on the way they do things,
but nothing that touches on structural separation and any way, shape, or form,
nothing that prevents them from doing an apple-like deal.
And so it's, you know, the bare minimum that the only way I can read it,
and I'm just spitballing here, but is that they're not giving an inch right now because they think either they can do some sort of transactional deal settlement with the current administration or that they can win on appeal.
And they don't want to show their cards by moving the line in any way because it's so far removed from the decision itself.
Right, because if they got defensive, then they would kind of reveal their hand for when they go to appeal what you're saying.
That's right. That's right.
And so what is the Department of Justice?
So the Department of Justice is saying they should sell off Chrome,
or is there anything else they're asking for?
They should sell off Chrome and they're struck, you know, divest Chrome.
They may need to divest Android, but it basically says,
let's see how that goes, but we can still do that.
And then very importantly, they're requiring them to share some data with other
search engines that would help other search engines have a more level playing.
field. And as it relates to publishers who, again, I do a lot of work for the, I work for the publishers.
It requires Google to allow publishers to narrowly define what Google can crawl and use data for.
And so the publisher can say, hey, you can crawl my website for the purpose of search,
but you cannot then use it to train your AI engines.
Fascinating.
So, yeah.
And so the DOJ is pushing to make sure that's the case.
The DOJ is very smartly understanding that if they don't put real constraints on Google around AI,
then they're only addressing past behavior,
but they're not actually making sure that there's a level playing field going forward
in which we won't be able to just abuse and run over the AI marketplace, too.
It really feels like we're kind of on the precipice of something changing.
in the next few years with the web.
Because if Google has to even share data from search,
that will change.
We will get competition in search for the first time,
really meaningfully, in decades, I guess,
since the Lycos and Alta Vista days,
because these two cases are so inherently intertwined.
Absolutely, yeah.
And don't shortchage gopher or web crawler in that.
Yeah.
But yeah, there hasn't been other search engines since the late 90s.
Oh, no, I think I said excite.
So, okay, changing gears before we wrap up.
You've been at the FTC case with Meta.
How's that going?
And also, what is that about?
So that is about whether or not when Meta,
when Facebook at the time acquired Instagram and WhatsApp,
that they were doing that to maintain their monopoly power,
in a market for personal social networking services.
And so that's, that is actually explicitly to break up meta.
So force them to divest WhatsApp and Instagram.
And the testimony I saw was Mark Zuckerberg, the CEO,
who was on the stand for roughly seven or eight hours,
which is a lot for any CEO.
He's the key witness.
And so now they're rolling into the other witnesses.
I think it's going well to answer your question.
Yeah.
So what are some of the highlights of things that Markymark said?
He, you know, he confirmed there's a lot of emails in that case.
And unlike the Google case where there was real problems with preservation of evidence
and there were emails and messaging that were deleted and all sorts of things that,
by the way, Google's Kent Walker got slammed by the judge for not preserving evidence
for like the third or fourth time now.
And you mentioned that during our interviews as well,
that the judge was pissed about this.
The judge was pissed and it came out in her opinion.
Yeah.
That abuse of attorney-client privilege.
She basically said the only, the way I read it was the only reason I'm not sanctioning you
is because I found you liable of breaking the Sherman Act.
And that's kind of what happened in the search case too.
And it's kind of in the App Store case, they did get sanctioned.
So there's the third antitrust loss that Google has in which they've been, you know,
nailed by the judge.
And they've got more trials coming.
So it's a problem for them.
And so the difference, the flip side of that is that Facebook and meta, you know, there's a wealth of emails.
And, you know, Mark clearly ran the company very tightly and drove the product decisions very tightly.
And he documented a lot of that in emails.
And some of them are pretty damning.
You know, I think the one that has always gotten the most attention is emails where he discussed,
why would we buy Instagram and focused in a...
on the reasons of neutralizing a competitor and buying time.
So neutralizing Instagram and buying time.
And a lot of the contemporaneous evidence shows that they were very, very concerned over
one year to 18 month period where Facebook was behind and moving to mobile.
Instagram was growing very, very quickly.
And they had screwed up by building the Facebook app for HTML5.
that's a technical thing instead of their own native app, and they were freaking out.
And there's a lot of emails about that.
That's fascinating.
So, and kind of returning to what I was saying previously as well, it feels like the results
of these trials could just fundamentally rebuild the web, because if Instagram was competitive
with Facebook, by which I mean, they had to spin it off and make it its own company,
and Google could no longer monopolize all the parts of the ads, it's going to change the economics
of everything underlying.
the internet because the internet is mostly paid for by ads.
That's right.
That last part's really, really important, Ed, that you're making is, we're talking about a lot of
the user behaviors and stuff, but there's $100, whatever, $40 billion of U.S. digital
advertising that goes to those two companies, I would get, you know, I'd estimate.
And so most of the growth in digital advertising over the last decade has gone to Google and
Facebook in some way, shape, or form.
And so how does it affect the advertising business becomes really, really important?
to all this.
And the way it would affect it is it could be cheaper for advertising, but it could also be
more chaotic because especially with meta's advertising product, from what I understand,
it's like almost the equivalent of Google Max in that you give meta money and it goes into
the greater metaverse.
I don't mean that with the cap.
Damn, I can't say that shit.
But goes into the greater meta series of products in the same way that Google Max, you put money in
it goes across all of Google's stuff.
That being broken up would be like Google, like 90 something percent of Meta's revenue
as ads as well.
Like this would destroy the company potentially.
Yeah, they've, you know, they're 96, 97 percent of their business is advertising.
And so you imagine a world where advertisers are buying through a different buy platform
or a neutral one, let's call it a neutral one that actually can buy ads on Instagram
versus the Facebook app.
and actually make decisions on that in real time of what's best for the advertiser.
I feel like they also have to compete for business in the way they've never had to,
or like justify their business and provide analytics that they don't already.
I've always asked the question of like when Facebook started to, you know,
really get described as a toxic waste dump in like,
like 2018, 2019 where they started to just run into some real difficulties.
Like Instagram, if I were Instagram, I would act differently if I wasn't part of the
of the larger corporation, right?
And they probably, Instagram would have put the screws to Facebook at that time and vice versa.
You know, and so it really changes the dynamic of those two platforms where they're actually
having to compete with each other, both for users and for ads.
The parent company, the brand is, you know, one of the least, you know, according to like
the Axios reputation survey, it's like number 99 or something like that in the 100
brand. So like the brand is significantly challenged despite the success of the company.
So as we wrap up, it almost, I know that we like this show is not necessarily the most
optimistic, but I kind of feel a little optimistic seeing all of this stuff. It feels like there
could be a better internet that comes out of it. I agree with that. And I also, you know,
make a broader point that it does make me optimistic to see courts,
doing what they're supposed to be doing, judges actually understanding the complexity of technology,
having attorneys that can describe it to the courts in a way that can be applied to antitrust law
that's been around for more than a century. And by the way, it should be said, too, that these cases
were brought by the Trump administration through a Biden administration, now they're being enforced
and we're getting decisions under a Trump administration again. So they're incredibly bipartisan.
And I had a chance to testify a few weeks ago in front of the antitrust committee, and that was incredibly bipartisan too.
And so these are issues that stretch across the parties that are pretty unique in this current moment.
And it kind of feels like the Dumerists out there are saying, oh, they'll just pay off Trump.
And it doesn't even feel, it feels like the administrations, both of them kind of have the same willingness to do this.
That's right.
I mean, the Wall Street Journal reported.
Obviously, we don't know.
Well, yeah, but the Wall Street General reported that Mark Zuckerberg met with the Trump,
with Trump administration or Trump himself, I think, three times in the last few months,
and offered to settle for $450 million, and the FCC wanted $30 billion.
And so you can see that there's a pretty big delta between the two.
And I think the Trump administration understands why these issues are issues, regardless of party and politics.
and too much power in the hands of two little people is always a problem.
Can you agree more?
All right, Jason, where can people find you?
They can find me on Twitter at Jason underscore Kent on Blue Sky.
They can always email me at DCN's website.
I'm around.
I'm always looking to engage.
So thank you very much.
Such a pleasure to have you, sir.
And you can, of course, find me on the internet, Google,
the man who killed Google search.
That's how you find me.
This has been better offline.
I'm Ed Zittron.
Thank you.
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