I want to thank Ranking Member klobuchar and her staff for working closely with me and my office as we prepared for today and i also want to thank our chairman, the chairman of the full Senate Judiciary committee, senator graham, for his support of this hearing. After i and then senator klobuchar giving our opening remarks, well hear from two panels of witnesses with questions from members of the subcommittee. We have Something Interesting to deal with in the senate and every time they call votes, when they call votes during a subcommittee hearing, were at their mercy. Senator klobuchar and i have both cast our votes on the first of a series of three or four. At some point, were going to have to pause or tag team as we allow other members to sit in for us, just dont be eisenhower sitting on a stone block in the direction of the greatest accomplishments the president of the United States and Supreme Commander of the forces him. Greg on welcome to todays hearing with the policy and Consumer Rights we have chosen for today if google has harmed competition with Online Advertising thank you to the Ranking Member klobuchar and her staff working closely with me in my office as we prepare for today and the chairman of the fold Judiciary Committee. After he gave our opening remarks you have seven minute rounds of questions. D in any conduct that harms competition and harms consumers. But before we go into that, i want to say just a few things about antitrust policy more broadly. Ive been a member of the subcommittee ever since 2011 when i first arrived in the senate and ive chaired the subcommittee for almost six years. Over that time as the public debate surrounding antitrust policy and enforcement has grown and in some cases evolved, so too has the gulf between the opposing sides. At one extreme are those who would rather that we have no antitrust laws at all. And the alternative, they advocate for an enforcement policy that is overly differential, speculative efficiencies and quick to dismiss evidence of competitive harm whenever it might conflict with unproven economic theories. This extreme end of the continuum fetishizes freedom to the exclusion of the laws that maintain that very freedom. They forget that markets, like governments, do not keep themselves free and that liberty is only secure when power is diffused. Theres been an agenda pushed to transform the antitrust laws in this country from a tool based in Economic Science to protect and promote competitive markets into a panacea for all of their perceived social ills. Built on the economically my myopthic that big is bad, these may be lotable goals, but theyre not problems that antitrust laws are meant to solve nor are they problems that antitrust law is capable of solving without creating a whole bunch of other problems. Attempts to repurpose antitrust law into a social Justice Program would have scores of unintended consequences that would cripple our economy for generations and of course theres the hypocrisy that big is bad, that they would expand in order to dismantle and regulate them. You may be wondering where i see myself in those two extremes, whose side am i on . Am i on the side of the American People . Yes. Am i on the side of the law . Yes. I believe enforcement of antitrust laws have made this the most prosperous nation on earth and our current laws are sufficient to meet the challenges of the day. I said a moment ago that liberty is only secure when power is defused. This is a bedrock principle of our republic. The concept of federalism, the greating contribution of our founding generation and document is what makes america unique among all other nations. This principle applies equally to economic power as it does to economic power. In a way, antitrust laws might be described as federalism for the economy. That brings us to today. Were here to discuss what may be the seminole antitrust case of the 21st century. One whose president will define the terms of competition and innovation in our dynamic economy for years, in fact for decades to come. Unlike some of my colleagues in the house, im not interested in staging a political spectacle to attack and talk over witnesses. Naive though it may be in 2020, my hope is that by looking at this specific question we can have a serious conversation about the state of competition in digital markets. Online advertising is an incredibly complex business and one that touches every Single Person on the internet. The technologies involved in connecting advertisers and publishers have evolved rapidly in the last decade and the expansion of Online Advertising has facilitated an explosion of online content by allowing the smallest website owners to moneytize the content they produce. Small and local businesses have also benefitted from being able to quickly and easily promote their businesses without any of the same Capital Investments that would have been required and indispensable for that effort just a few decades ago. At the same time this growth and this expansion has been largely consolidated onto a single platform. Googles online ad business. As that business has grown, so too have complaints that google, which both operates the ad selling and ad buying platforms and sells its own inventory through those platforms. As conflicts of interests is manipulated and rigged Online Technology to favor its own interest and protect its own market share. Whether this is true or not matters because so many businesses depend upon Digital Advertising to market their products or to moneytize the content that they produce. Web users benefit from free online content and being connected to relevant businesses in a way that helps them to make optimal business decisions. Simply put, markets function better when businesses thrive and consumers are informed. Online advertising helps accomplish this. If however Online Advertising has been monopolized and constrained, everyone loses to that degree. I would also add that google and other Big Tech Companies have been accused of a number of bad acts unrelated to antitrust or to competition. I myself have repeatedly expressed concerns about an anticonservative bias by these firms. And ill continue to pursue those concerns. But while i believe it issues like anticonservative bias have implications for antitrust such as perhaps evidencing market power, todays hearing is not fundamentally about those concerns. This hearing is about an analytically distinct issues that are a legitimate subject of inquiry. I reject using antitrust to solve other nonantitrust concerns. Todays discussions will, i hope, help everyone to better understand the Online Advertising market and how competition works or should work and how it might not be operating as well as it could in that space. I look forward to hearing from our experienced and highly qualified witnesses. Thank you and ill now turn to Ranking Member klobuchar for her opening remarks. Thank you so much, mr. Chairman, and thank you to our witnesses, to mr. Harrison appearing virtually and i want to start by making something absolutely clear. We are notoinw having this hear because google is successful. Google is successful. I just used it on my way here. Or because google is big. Thats not why from my perspective were having this hearing. We are having it because even successful companies, even Popular Companies and even Innovative Companies are subject to the laws of this country including our antitrust laws. We are all successful when we make sure that our economy is strong and our economy is working better. But the law cant be blinded by googles success or its past innovations if the company in its zeal to achieve greater success crosses a line into anticompetitive behavior. Its our job to regulate it. Its that simple. So were going to touch on issues, i hope, today of competition, technological innovation, the use of personal data, these are some of the defining issues, as the chair has said, defining issues of our time and i personally think, as we go into the months to come, this wont just be about google. This isnt just about the Tech Industry as much as i believe we need to change our laws and look at changing the burdens and making it so that our laws are sophisticated as the companies that now occupy our economy. I think we need to do all that and i think it should be a huge priority going into the year. But right now as the chairman mentioned, we are focused on this issue today. Our society has never been more dependent on this technology than we are now in the midst of this global pandemic. As i noted, not just google, the pandemic has forced a bunch of Small Businesses to close their doors and the five largest Tech Companies continue to thrive to the point where they briefly accounted for nearly 25 value of the entire s p 500 stock index just a few weeks ago. I dont quarrel with their success but we have to look at do our laws match that situation. And even if the original intent when these companies started as startups was to be innovative, which theyve been, at what point do you cross a line so you squelch innovation and competition from other companies. The powerful companies that provide us with these technologies are collecting personal information. We know that. They know who our friends are, they know the books we read, where we live, whether weve graduated from college, income levels, race, how many steps we took yesterday. The chairman and i share an interest in this. How long weve stayed where we are. Machine learning, analyzes troves of personal data, allowing our firms to discern even more Sensitive Information about us, our medical conditions, political, religious views and even preferences that we dont even know we have. And why would companies do all of this . Put simply, to target us with digital advertisements. Theres really no other reason. It is a capitalist society. Thats what they do. Now google makes more money doing that than any company in the world, by leveraging its unmatched access to consumer data gained through itself existing dominance in Online Mobile operating systems, android, email, gmail, youtube, browsers, chrome, google maps and Ad Technology. This Ad Technology ecosystem, known as the ad tech stack consists of advertisers on one side and publishers on the other. On the advertising side google controls access to the huge number of advertisers that place ads on Google Search which is 90 of the Search Market and has unparalleled access to data. Google h it also effectively controls the process, the ad auction process that gets an advertisers ad to be put on a publishers site. Google dominates all the markets for services on both sides of the ad tech stack, the establisher side and the advertising side and i hope that will be a lot of our focus today. Research has suggested that google may be taking between 30 and 70 of every advertising dollar spent by advertisers using its services depriving publishers of that revenue. Who are the publishers . Theyre content producers. The minneapolis star tribune, to me given that my dad was a journalist, to me this is one of the key elements here because if you have unfairness in how that ad echo system is going, youre depriving these news organizations at a time when the First Amendment is already under assault of the revenue that they need to keep going. So whether its happening, and we dont know all of the details at the department of justice right now, this could be the beginning of a reckoning for our antitrust laws to start looking at how were going to grapple with the new kind of markets that we see across the country. It would help answer the question whether our federal antitrust laws are able to restrain the business conduct of the Largest Companies in the world. When you think of the breakup of at t, that was our last big thing that happened in the antitrust area. What did that lead to . Lower prices, more competition. It really worked. But were not able to do this right now. And my hope is that were getting the start and the Justice Department, that things are going on at the ftc. But to really do that, theyre going to do resources to take on the legions of lawyers at the companies and thats my first goal. What can we do for enforcement. My second what do we have to do to make the laws work better, to look at some of the deals that have already been made. What are the remedies . Do they make a difference in changing the behavior and allowing competition . I literally dont have personal grudges against these Companies Like sometimes the president has expressed about various companies. I dont. I just want our capitalist system to work. I want it to work and to have it work you simply cant have one company dominating areas of an industry. Our Founding Fathers started this country in part because they were rebelling against monopoly power. We need to keep that spirit of entrepreneurship strong in this country and this is a good way to start. Thank you, mr. Chairman. I will be here for questions. Thank you. And youll be here in spirit, either way. Thank you very much, senator klobuchar. Well have two panels today. Our first panel will consist of mr. Harrison. He is joining us virtually. If youll stand please to be sworn. Do you affirm that the testimony youre about to give before the committee will be the truth, the whole truth and nothing but the truth. I do. Thank you. Ill briefly introduce our witness for our first panel, don harrison is googles president of Global Partners and corporate development. He oversees googles Strategic Partners worldwide and is responsible for product and ecosystem enablement and commercial partnerships across googles business groups. Hes worked on grade schooogle transactions. He also manages googles internal incubator, area 120 and gradie gradient ventures. He started his career at the toronto law firm. After earning a degree in Political Science in philosophy. Thank you for joining us today and we look forward to your testimony. Well now hear your opening remarks. Chairman lee, Ranking Member klobuchar, and distinguished members of the committee, thank you for the opportunity to appear before you today. My name is don harrison. I lead our Partnerships Team where we support the growth of our products to partnerships working with a range of businesses to help them use our products to grow and succeed. I oversee our inhouse incubator fostering innovation and the development of new technologies. My job at its core is to help other businesses grow. As our partners businesses grow, ours does as well. We build tools that help businesses grow. One way we help is through advertising. Over 36 of clicks to american advertisers come from overseas. Online advertising prices in the u. S. Have fallen 40 since 2010. The benefits of these prices flow to american businesses and consumers. We help businesses grow from advertising on our own sites and other sites. A wide range of businesses including many small firms advertised on our sites in apps like Google Search and youtube. Thats where we earn a majority of our revenue. In addition to ads on our own properties, google helps businesses advertise in a wide range of other websites known as publishers. We offer technology that helps advertisers buy ad space and helps publishers sell their ad space. This technology is referred to as ad tech. It accounts for a small fraction of our advertising revenue and we share the majority of that revenue with publishers. The ad tech space is crowded and competitive. We compete with adobe, amazon, at t, oracle and verizon, as well as many more. Publishers and advertisers use tools from an array of providers. The average publisher uses multiple tool and is the average advertiser uses multi advertisers. In 2018 we paid more than 14 billion to our partners. This up from 10 billion in 2015 publishers kept over 69 of the ad revenue, more than the industry average. In other areas when it comes to ad tech we take an open approach. We make our tools interoperable with rivals, increasing choice and competition. Publishers and advertisers enjoy a wide range of choices. Our tools get publishers access to demand from over 700 advertising platforms, and advertisers access to more than 80 publisher platforms. This fosters vibrant competition. Our tools can also work sa seamlessly together generating efficiency, speed and security benefits for publishers, advertisers and consumers. The free and open internet we all enjoy is made possible by advertising. Without it websites with be forced to adopt subscription on models, bring their content behind pay walls or shut down operations entirely. This would harm consumers with higher prices and reduce choice online. Looking ahead well continue investing in space Building Tools that help publishers and advertisers grow their businesses, supporting a free and open internet we all enjoy. Thank you for inviting me to participate in this discussion. I look forward to continuing to engage with the committee on these important issues. Thank you very much, mr. Harrison. Thank you for joining us today. Were going to now launch right into our alternating rounds of sevenminute questions and i will begin that. At the outset i want to address something briefly that i mentioned in my Openin