Tech News

Google proposes to move advertising business to Alphabet to keep regulators away

in great shape , See, you’ve come to my “Google Ads” place, and with three houses… that would be $1,400.

Rum Amadeo / Hasbro

The US Justice Department is gearing up for a potential antitrust lawsuit against Google’s advertising business, and a new Wall Street Journal report outlines a “concession” that Google is proposing in response to the investigation. Google may divest some of its advertising business and move it to Google’s parent company, Alphabet.

The WSJ’s summary of the report states: “As part of a proposal, Google has proposed to split the portion of its business that auctions and places ads on websites and apps into a separate company under the Alphabet umbrella.” , some people said. That entity could potentially be valued at tens of billions of dollars, depending on what assets it has.”

The goal of “splitting up” the advertising division is not necessarily to separate the entire advertising division from Google, but to undermine Google’s overall ownership of the advertising business. The company currently acts as a broker and auctioneer for the ads – that’s what the DOJ has a problem with. Google makes tools that cover both the “buy” and “sell” sides of the web advertising world, which naturally leads advertisers using Google’s buy tools to publishers selling ad space with Google’s auction system. pushes. Most online systems work in a similar way. Amazon has an interface where Amazon product sellers sell Amazon products to buyers, Uber has a system for drivers and riders, but when you’re a monopoly the rules are different, as in “too big”.

The solution proposed here will move the “Sell” side of Google Ads to Alphabet and the “Buy” side of Google. The idea, presumably, is that the move would slightly open the door for Google to talk to advertising systems other than Google, but it’s not clear whether Google/Alphabet would be given a mandate to open up.

Is there a difference between “Google” and “alphabet”?

In response to the report, a spokesperson for Google told The Wall Street Journal, “We engage constructively to address regulators’ concerns. As we have said previously, we have no intention of selling or exiting this business.” No plan.” The spokesperson said: “Tough competition in advertising technology has made online ads more relevant, with lower fees and expanded options for publishers and advertisers.”

In the absence of any sort of mandate to open an advertising business, it is not clear what actual changes would occur if a part of Google’s advertising business was transferred from Google to Google’s parent company. The casual observer might assume an alphabet spin-off sounds like some sort of transformation, but most seasoned Google-viewers, your writers included, won’t notice any real-world difference between “Google” and “alphabet”. Will struggle to point. In this situation, the Head of Ads will stop reporting to Google CEO Sundar Pichai and start reporting to Alphabet CEO Sundar Pichai, Google and Alphabet also have similar CFOs and similar stock symbols, and no Google or Alphabet company would be a self-sustaining business without a plethora of Google’s advertising revenue. Alphabet company leaders receive the coveted title of “CEO”, but they still have to respond to Alphabet’s financial needs and the Alphabet/Google CEO.

Pitching an Alphabet spinoff as some sort of separation certainly doesn’t match how Alphabet has worked in the past. Independent Alphabet companies often operate together as a single entity. We often see this with DeepMind technology in “Google” branded products, with Google Fiber’s continued use of the “Google” brand, and with Alphabet’s “Capitalgy” venture capital company, which comes right out and says, “As part of Alphabet, we have exclusive access to Google’s insights and expertise.” It will take a lot of work to convince Google that the meaning of alphabetical separation goes beyond trivialities in an organization chart.

Source link

Related Articles

Leave a Reply

Your email address will not be published.

Back to top button