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Early September began with a flurry of headlines involving three of the sector’s biggest names: Amazon, Google, and The Trade Desk.
The implication is that these developments are indicative of the shifting sands amid which many are attempting to establish a level footing, as AI becomes Madison Avenue’s default setting, not a selling point, and financial realities take hold.
First, let’s recap the events in the chronological order in which they transpired (publicly at least), and then digest what they represent in summary.
FTC charges Amazon’s ad tech
Amazon’s advertising auction mechanics are under regulatory scrutiny over allegations it quietly pushed prices closer to advertisers’ maximum bids while continuing to present its system as a second-price auction.
The Federal Trade Commission and 22 state attorneys general allege that, beginning in 2019, Amazon introduced a “soft reserved price” — effectively an artificial competing bid that increased the winning advertiser’s price without an equivalent bid from a genuine competitor.
Regulators claim this made auctions behave more like first-price auctions, potentially leaving advertisers paying close to their maximum bids. The practice allegedly expanded from 30%-40% of relevant auctions in 2021 to around 80% by 2024, affecting more than one million advertisers and generating tens of billions of dollars in additional charges.
Amazon rejects the allegations, calling the lawsuit “misguided.” It argues bids are only one factor determining which ads win and says inflation-adjusted Sponsored Products costs remained broadly flat between 2019 and 2024.
The case ultimately raises a broader question for retail media: whether the auction models platforms advertise accurately reflect how advertisers’ prices are actually determined, and for many Digiday readers, it echoes points made in the Justice Department’s recent case against Google’s sell-side ad tech offering.
(Another) regulatory let-off for Google And it’s in this regard that the second big ad tech story of the week unfolded as the long-expected remedies ruling of Google’s ad tech antitrust trial was made public, with popular opinion to it easily summarized with the saying: even when they lose, they win.
In a ruling issued in a courtroom in the Eastern District of Virginia, Justice Leonie Brinkema — who ruled Google a monopolist (for the second time within 12 months) late last year — rejected a breakup, substituted behavioral remedies, and presented the practical case against divestiture, along with the counterargument that behavioral enforcement has many of the same weaknesses.
Considering a similar remedies ruling in its search antitrust trial 12 months ago, it seems that Google’s immunity from a breakup is inevitable. Justice Brinkema’s reasoning remains sealed until mid-September, so the precise requirements aren’t yet public, but it appears she drew from “most” of the behavioral proposals submitted by Google, recommending limits on its ability to self-preference, publisher data-sharing and nondiscriminatory treatment of rival ad tech.
The parties largely agreed on those principles but differed significantly on scope. Google proposed giving rival ad tech companies real-time visibility into marketplace bids and allowing publishers to insert independent auction technology between its products — but only for standard web display advertising. The DOJ wanted broader visibility, stronger prohibitions on self-preferencing and independent auction mechanisms across formats.
For some, Brinkema’s rejection of divestiture shouldn’t be surprising, as during trial, she questioned whether a credible buyer existed for Google’s ad exchange and whether structural remedies made sense in a market changing faster than years-long litigation and appeals could accommodate. Google also argued a breakup could disrupt video and app advertising, where no illegal monopoly was established, while potentially changing an ad-server product that 92% of publishers currently receive for free.
For some, a market moving too quickly for structural remedies may also move too quickly for monitors to police behavioral ones effectively. Faster implementation doesn’t mean faster resolution: disputes over what constitutes self-preferencing, interoperability or compliant data-sharing could continue for years.
The Trade Desk sheds hundreds of roles
Capping off what many in the independent ad tech sector will deem as an extremely disappointing week, The Trade Desk — for many, the talisman for the independent ad tech sector, and one that finds itself in the crosshairs of Amazon’s aggressive growth targets — announced it would cut headcount by 15%.
The Trade Desk CEO Jeff Green told employees the restructuring was intended to make teams smaller, faster and more focused, stressing the cuts were not driven by financial distress, citing approximately $1.5 billion in cash, no debt and revenue growth from $202 million in 2016 to more than $2.9 billion last year. Instead, he characterized the restructuring as positioning TTD for its “next phase of growth.”
The company plans to organize employees into smaller teams with greater ownership and reinvest resources in growth and innovation, with Green reiterating the demand-side platform’s strategy of remaining focused exclusively on ad buyers, not owning media inventory — surely, a jibe at the aforementioned ‘conflicted’ interests of his Big Tech rivals — and positioning itself as an objective buying platform for the open internet.
While the company did not publicly disclose the precise headcount reduction, which is expected to cost $51 million, its latest 10-K filing with the Securities and Exchange Commission said it had 3,843 full-time employees as of December last year. Assuming there were no significant headcount reductions in the interim, this would put the September 4 layoffs in the region of 570 roles. Are the cards stacked to Big Tech’s advantage?
For many, these three developments point to an ad tech market whose competitive balance is becoming increasingly uneven. Amazon is aggressively monetizing its enormous commerce and first-party data advantage — aggressively enough that the FTC and 22 states now allege its auction practices crossed into deception — while Google has again avoided the structural remedy that could have materially weakened its position. And it’s against this backdrop that The Trade Desk’s decision to cut approximately 15% of its workforce looks particularly significant, despite CEO Green’s assertion that “our best days are ahead.” And it’s against this backdrop that enforcement in the Google case becomes crucial.
Google argues it has already implemented, or plans to implement, many of the proposed changes. Now that claim gets tested — particularly whether rivals receive genuine interoperability, Google stops quietly favoring its own products, and meaningful limits are placed on how data moves across its businesses.
Taken together, the developments suggest the next phase of ad tech competition will be less about simply challenging the incumbents and more about whether independent platforms can remain differentiated — and sufficiently scaled — against companies whose advertising businesses are reinforced by much larger ecosystems.
What we’ve heard #
“Performance Max is a bête noire. AI Max is the cousin. Same family. Same instinct. The platform decides what you buy and lowers the transparency.
– TAU Marketing Solutions CEO Robert Webster on Google auto-upgrading Search campaigns to AI Max, a development released last month to almost no fanfare.
Numbers to know #
As WPP’s Cindy Rose marks a year as CEO, turnaround is underway but far from certain, judging by the raw numbers:
- $3 billion : The estimated media value of fresh accounts won by WPP Media so far this year
- $2.81 billion : The estimated media value of accounts lost by WPP Media over the same period
- 43% : WPP Media’s account retention rate so far this year
- 16% : WPP Media’s account retention rate last year
- $6.98 billion : The estimated media value of accounts WPP Media lost last year
What we’ve covered #
OpenAI’s ChatGPT ads business hits $1 billion run rate as Europe gets self-serve access
The company is expanding self-serve ad access across Europe, but reaching its ambitious targets of $2.5 billion in recognized revenue by 2026 and $100 billion by 2030 will require drastic acceleration—not just steady growth—from its current monthly pace of roughly $83 million.
WTF is the IAB’s Redefining Media Types standard?
The Interactive Advertising Bureau just dropped another industry acronym — as if the media biz needed another one — but this one may prove useful.
What we’re reading #
Why is this important? Because Google said, “Beginning on February 17, 2027, we will move to the Begin-to-Render methodology. This means an impression will only be counted once the ad has successfully loaded and has started to render on the user’s device.”
Jon Whitticom helped build Netflix’s paid-for business, and the streaming giant’s current advertising president, Amy Reinhard, recently circulated a memo explaining his departure and how product executive Marc Heneghan would take over his duties as the hunt for a permanent replacement continues.
WPP’s alleged global rebate scheme, told through three court cases
Three separate cases put WPP at the center of an alleged illegal rebate practice carried out by WPP executives through its media buying arm.
Google’s bidding change proves agentic advertising has an agency problem
Writing in AdExchanger, Goodway Group’s Toni Poulain notes how Google Ads’ changes to target-based bidding on budget-limited campaigns – this has caused algorithms to bid more aggressively to hit specified ROAS or CPA targets regardless of historical efficiency – demonstrate how platform-owned autonomous systems operate under rules that prioritize the platform’s economic interests.
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