By Jason Bier, Chief Privacy Officer & Legal Counsel, Adstra
The United States has so far trailed behind its global counterparts in reigning in the expansive powers of big tech giants. In 2024, a confluence of pivotal developments will supposedly permanently shift this narrative. Google’s initiative to aggressively attempt to phase out third-party cookies and stated intentions to do the same with IP addresses would remove the critical linkages that have held up the internet since it began – at a time when many businesses are still unprepared for life without them. Meanwhile, generative AI has created a new set of tricky questions, from copyright infringement to the impact on publishers’ search traffic. Combined with the impending resolution of the DOJ’s and States’ antitrust lawsuits against Google, and the European Union member countries’ investigation into Google’s alleged anti-competitive ad tech practices, these developments position this year and next as a significant turning point. Tensions between big tech and media companies have simmered for decades, and we are now reaching a boiling point.
Global Enforcement Tightening
Globally, the enforcement landscape has seen a notable tightening under new privacy laws. In Europe, Google’s €500 million fine under GDPR for failing to negotiate in good faith with news publishers over the use of their content underscores the seriousness of these regulations. In Australia, the News Media Bargaining Code has compelled tech giants like Google and Meta to start compensating publishers for content. This global trend of robust enforcement is increasingly influencing tech companies’ operations and strategies, setting significant precedents in the digital content ecosystem.
This wave is now coming to the other side of the Atlantic. In recent months, Google has faced an unprecedented wave of legal challenges, signaling a significant shift in the regulatory landscape for big tech. A federal judge recently ruled that in early 2025 Alphabet’s Google must defend itself against antitrust charges brought by 16 states resulting largely from its acquisition of DoubleClick. This follows a series of significant legal setbacks for Google, including settling a $5 billion class-action privacy lawsuit alleging secret tracking of consumers in “incognito” mode. Additionally, Google agreed to pay $700 million to settle a lawsuit accusing its app store of being an illegal monopoly that overcharged consumers. This string of legal actions also includes a unanimous jury verdict against Google in an antitrust case brought by Epic Games, where Epic won all 11 of its antitrust claims. Just a day before the Epic ruling, Google faced another class-action lawsuit alleging similar antitrust violations, this time involving Google’s AI and chatbot Bard.
Meanwhile, two major antitrust cases and an investigation of Google’s ad tech dominance by the European Union loom on the horizon. The first, U.S. v. Google, is a landmark trial anticipated to take place this Summer, where the Justice Department is attempting to force Google to divest from ad tech. The second, a pending decision in federal court in Washington, D.C., targets Google’s search engine ad practices. That trial, although shielded from public view, did not appear to go well for Google. In Europe, Google’s challenges continue with a fine of over $8 billion from the European Commission for breaking antitrust laws, which Google is currently appealing. These cases collectively paint a picture of a decisive shift in the balance of power between big tech and the rest of the media ecosystem.
Google’s Privacy Sandbox: A Critique
The UK’s Competition and Markets Authority (CMA) has raised significant concerns regarding Google’s proposed replacements for the third-party browser cookie, particularly focusing on their Privacy Sandbox initiative. This critique highlights the broader implications of Google’s strategy in reshaping the digital advertising landscape. By pushing the industry towards its Privacy Sandbox, Google is effectively positioning itself to benefit while placing the onus of adapting to a cookieless environment on publishers and advertisers. This transition, which requires adapting to a world without traditional linkages like cookies, MAIDs, and IP addresses, places smaller players at a distinct competitive disadvantage.
The industry’s preparedness, or lack thereof, for this shift is a critical factor in the unfolding narrative. While there are robust infrastructures in place for transacting securely and privately using first-party data and identity, their adoption is still lagging and will all but cement the future for entrenched news organizations and Google. The new identifiers that are emerging as alternatives to cookies and MAIDs do not yet offer the same scale and reach, posing significant challenges for brands and publishers. These entities are now finding themselves in need of partners to help navigate the complexities of using multiple identifiers to achieve their marketing and advertising goals. This transition period is creating a fragmented landscape where the ability to reach audiences effectively is becoming increasingly complicated and costly, especially for smaller players who may not have the resources to invest in new technologies and partnerships.
As Google attempts to deploy its Privacy Sandbox, it is not just altering the technical underpinnings of digital advertising; it is also reshaping the market dynamics and is haphazardly breaking websites as they rush to launch tests across the globe. Their proposed solutions, while positioned as enhancing privacy, could potentially further entrench Google’s dominance by creating a new ecosystem where they control the key tools and technologies, and leave smaller businesses in the dustbin. It is clear at this point that Google has had a plan in place for over a decade to circumvent businesses across the world so it can dominate the technology landscape by utilizing chokepoints in all browsers through its efforts at the World Wide Web Consortium (“W3C”) and confidential agreements with browsers to dominate search.
While the deprecation of cookies, MAIDs and potentially IP addresses are not the focal point of privacy rules or antitrust suits, their impacts on the basic communications that brought the internet the success it has had up until today will shape the political and legal context in which all of it plays out.
On the Precipice of Change
All of this is adding up, and this year, the longstanding dynamics between big tech and media are on the verge of dramatic collision. The convergence of evolving privacy laws, groundbreaking technological advancements, and significant legal challenges suggests a redefinition of the rules of engagement. How digital privacy, content dissemination, and advertising coexist in the rapidly changing digital world is poised for a reevaluation that could very likely lead to a new Golden Era of increased innovation, competition, and enlightenment as more clarity results in the current status quo for the internet’s existing mechanisms for communications. The actions and adaptations of these tech giants in the face of these challenges will be closely watched, signaling the future trajectory of the digital landscape.