[impulser_]

I'm guessing the worst case is they are forced to sell off the exchange side of the Ads business, which isn't that much revenue compared to the revenue they make selling ad space.

This is probably going to have a lot less effect than what people are assuming it will have.

Google and Facebook have never had more competition in the Ad space. Apple and Amazon are building big Ad businesses fast. That's not the problem. The problem is they play both sides of the market and they dominate both sides of the market. Therefore they have a lot of pricing power.

This isn't the reason they are making 100s of billions a year. The reason they are making that amount is because they are the best at what they do and you can't find the service they provide any where else except Facebook and Google.

[ricardo81]

>This isn't the reason they are making 100s of billions a year.

I do believe that the 're-targeting' Google can afford by having their assets on the majority of sites helps them maximise CPM, which would certainly be a problem for any alternate search engine who isn't interested in tracking people around the web/net. I can't remember specific figures but noted in the UK CMA report that Google generally makes twice as much as Bing on search ads (and worth bearing in mind that much of the rest of the entrants are essentially Bing meta search engines in the West)

But I agree they're certainly considered the best at search in many ways, though the increased CPM they make allows them to be made the default search engine of choice on most devices.

Becomes a bit of a chicken and egg problem when the most prominent search engine can reinforce its position as one.

[impulser_]

I'm not sure on how Bing ads work, but I think Google makes more because they are better at targeting and with limited space and high demand you get higher pricing.

Facebook and Google are really the only two ad platforms that I know off that you can really target ads to the people you want and you can build ads around those you are targeting instead of making generic ads like you see on other platform and TV.

[strongpigeon]

I agree with your take. Most likely they’ll be forced to divest from the Ads Exchange business which won’t affect them materially.

It would open up some possibilities for actors in that space to shift the balance of (pricing) power a bit, but I’m unsure the impact will be huge. All the big new advertising platforms tend to own their whole stack like you mentioned (Amazon, Apple) and for good reasons.

[frozenlettuce]

I believe that not controlling the exchange will affect them materially. Not because of the exchange's profits, but because of the data that it provides that lets Google optimize their campaigns (giving it an unfair advantage, as the competition has no access to this data).