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The U.S. Justice Department is doubling down on its attempt to break up Google by asking a federal judge to force the company to part with some of the technology powering the company’s digital ad network. The proposed dismantling coincides with an ongoing federal effort to separate Google’s Chrome browser from its dominant search engine. The government’s latest proposal was filed late Monday in a Virginia federal court two-and-half weeks after a federal judge ruled that its lucrative digital ad network has been improperly abusing its market power to stifle competition to the detriment of online publishers. In a 17-page filing, Justice Department lawyers argued that U.S. District Judge Leonie Brinkema should punish Google by ordering the company to offload its AdX business and DFP ad platform, tools that bring together advertisers, who want to market their products, and publishers, who want to sell commercial space on their sites, to bring in revenue. The government also is seeking other restrictions, including a 10-year ban on Google from operating a digital ad exchange, to undercut the power of a recidivist monopolist. Not surprisingly, it’s an idea that Google vehemently plans to oppose when the penalty phase of the antitrust case known as remedy hearings begins in late September. Google already has vowed to appeal Brinkema’s ruling that the technology powering the ad network has been breaking the law, but can’t do that until the judge rules on its punishment in a decision expected late this year or early next year. The Justice Department’s proposal would cause economic chaos and technological dysfunction resulting in harm to millions of advertisers and publishers, and in so doing, degrade the experience of internet users, Google said in a court filing late Monday. In its counterproposal, Google outlined a plan that it believes will bring more transparency to its ad network and eventually foster more competition. Google proposed the appointment of a trustee to oversee its behavior for three years. The attempt to tear down Google’s ad network comes on top of the Justice Department’s ongoing effort to have the company part with its popular Chrome browser and impose other restrictions to curtail the power of its ubiquitous search engine, which another federal judge branded an illegal monopoly in a ruling last August. The remedy hearings in the search case are scheduled to conclude later this month, with a ruling from U.S. District Judge Amit Mehta expected by Labor Day. If the Justice Department is able to persuade the two different judges to order its proposed dismantling of Google, it would be the biggest breakup of a U.S. company since AT&T was forced to spin off its phone service into seven separate regional companies more than 40 years ago. Google’s Play Store for apps running on its Android software that powers most of the world’s smartphones also was declared an illegal monopoly by a federal jury in 2023 and is battling a judge’s order that would require it to overhaul a commission system that generates billions of dollars in annual revenue. But hobbling its search engine and digital ad network would be far bigger blows because they are the key cogs in a business that generated $265 billion in revenue last year. Google is confronting the breakup threats at the same time the advent of artificial intelligence is changing the way consumers are using technology and seeking information online a shift that could also siphon traffic and money away from a powerhouse that began in a Silicon Valley garage in 1998. Despite the adversity, Google is still delivering robust financial growth to its corporate parent Alphabet Inc., which is currently valued at $2 trillion. Alphabet’s shares dipped slightly during Tuesday’s late morning trading. Michael Liedtke, AP technology writer
Category:
E-Commerce
Its official: You won’t be able to afford as many dolls as in the past. Thats based on Mattels first quarter financial report, released yesterday. While the results indicated that the company had a resilient first quarter, it also foreshadowed price hikes to come. In a meeting with investors, the company reported net sales of $827 million for the period, up 2% year over year, but pulled its full-year 2025 guidance, given the volatile macroeconomic environment and evolving U.S. tariff situation. Mattel CEO Ynon Kreiz also shared that while Mattel has a three-pronged plan to mitigate tariff-based losses, prices for some products are expected to rise. The Barbie-makers report comes as President Trump has turned dolls into a kind of symbolic flashpoint in his ongoing trade war. According to the Toy Association, a national industry group, nearly 80% of the toys sold in the U.S. are sourced from Chinameaning that toy and doll companies have been scrambling to absorb the impact of Trumps 145% tariff on Chinese goods. Last week, the president commented on reports that store shelves could soon be empty due to the tariffs on China, and the resulting tanking import volume, by acknowledging potential price hikes. Somebody said, Oh, the shelves are going to be open, the president told reporters. Well, maybe the children will have two dolls instead of 30 dolls, and maybe the two dolls will cost a couple of bucks more. Now, it appears that the presidents uncharacteristically frugal suggestion is inching closer to becoming a reality as Mattel is forced to rethink its supply chain and prices in order to offset the cost of Trumps tariffs. Mattel has a 3-part tariff mitigation strategy On yesterdays call, Kreiz told investors that Mattels tariff-mitigation plan includes three main approaches: Accelerating diversification of our supply chain and further reducing reliance on China-sourced products, optimizing product sourcing and product mix, and where necessary, taking pricing action in our U.S. business. Shifting the supply chain away from China is one of Mattels top priorities for a reason. The U.S. represents about half of Mattel’s global toy sales, and the company imports about 20% of its goods sold in the U.S. from China, according to a Reuters report. Mattel told Reuters it would reduce imports into the U.S. from China to below 15% by 2026. The company was planning to reduce reliance on Chinese manufacturers even before Trump took office, assuring investors back in December that, in 2025, Mattel will source less than 40% of its goods from China, as opposed to the industry average of over 80%. Ultimately, there will be price hikes on playtime But for Mattel, these supply chain steps likely still wont be enough to absorb tariff-based fees, which company finance chief Anthony DiSilvestro said in a post-earnings call are expected to reach $270 million in incremental costs over the course of the year, starting in the July quarter. As an added measure, Kreiz told investors that consumers can expect pricing adjustments on some products. While he didnt share details on specific products or price increases, he did predict that 40% to 50% of all Mattel product will remain at or under the $20 threshold. This is something we are committed to do, Kreiz told CNBC this morning about the new prices. To continue to create quality product and find the right balance of price and value, all in the service of the consumer. Deeper supply chain disruption could be yet to come The Mattel price increase announcement comes amid deep disruption to store supply chains, which are expected to increase as U.S. imports from China plummet and stockists pause orders. There was a nearly 43% drop in containers received from China, week over week, between April 21 and April 28, according to port data from Vizion. Retailers typically place orders for the holiday season around now as well, indicating a possible negative downstream effect later in the year. We have a frozen supply chain that is putting Christmas at risk, Greg Ahearn, chief executive of the Toy Association, told The New York Times. However, consumers could notice reduced product availability and purchasing power even sooner. Retail inventories may actually look lean in coming months, a May report from the Bank of America Institute stated. Fast Company has reached out to Mattel for more specific examples of the coming price hikes. The company did not respond by time of publication.
Category:
E-Commerce
Elon Musk has ruffled plenty of feathers since stepping more prominently into the political arena. Now, it seems hes also a bad neighbor. In 2022, Musk purchased a six-bedroom, $6 million mansion in the upscale Austin suburb of West Lake Hills, Texas. At the time, he didnt knock on doors or introduce himself to his new neighborsbut word spread quickly, especially when visibly armed security personnel and their vehicles began appearing on the quiet suburban street. Since moving in, Musk has erected an unauthorized 16-foot chain-link fence, installed a metal gate, and mounted outward-facing camerasactions that have irritated local residents, according to a recent report by The New York Times. I call that place Fort Knox, said Paul Hemmer, a Tesla owner and retired real estate agent who lives across the street. Hemmer is also president of the neighborhood homeowners association. When Musk later attempted to retroactively gain permission for the additionswhich violate six city ordinancesthe West Lake Hills Zoning and Planning Commission voted unanimously against granting variances. Wed incentivize people to break the rules, one commissioner told the Times. The matter is now set to go before the West Lake Hills City Council in a session scheduled for May 14. Unless the Council overrules the commissions decision, the fence and gate may need to be removed or modified to comply with town regulations. The mansion is one of three Musk has purchased in the area over the past three years, with plans to create a compound for his children and their mothers. Musician Claire Boucher, better known by her stage name Grimes, previously lived there with the three children she shares with Musk. Shivon Zilis, a brain technology executive and mother to four of Musks children, lives just a 10-minute walk away. In recent months, the house has been quieter, as Musk has spent more time in Washington advising President Donald Trump. But neighbors say they are bracing for his return. Hemmer, who now flies drones over Musks property to check for city code violations, also has round-the-clock video surveillance in place, he told the Times. Musks security team has taken noticereporting Hemmer to police for allegedly standing naked in the street (he was on his property, wearing underwear). On another occasion, Hemmer was caught urinating by Musks cameras. The cameras got me, he said. Its scary they have guys sitting and watching me pee.
Category:
E-Commerce
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