Challenging times for tech giant Google as its advertising business faces accusations of transparency lapses and excessive revenue extraction by advertisers and website publishers. The ongoing antitrust trial in the United States highlights concerns about Google leveraging its dominance in search and advertising practices.
Adam Juda, Google’s VP of Product Management, revealed that Google employs a formula incorporating ad quality to determine auction winners for website ad placements, as reported by Moneycontrol. This disclosure added another layer to the accusations against Google, with the US Justice Department now alleging manipulation of online auctions through these formulas. When questioned by the Justice Department about the company’s ability to influence pricing through auction mechanisms, Juda acknowledged that ‘they could’.
Juda went on to highlight that what can be ‘tuned’ is a rough formula which gives an ad a long-term value. This is based on the bid given and potential click-thru-rate followed by the quality of the advertisement and website associated with it, as per Moneycontrol.
Recently, in the antitrust trial, the chief executive officer of Microsoft, Satya Nadella, alleged that the dominant position of Google over search made it difficult for Microsoft to compete.
He went on to state that Microsoft was unable to overcome the multi-billion dollar deals of Google to become the default search engine on web browsers and smartphones, stated a report.