The Department of Justice and eight states filed antitrust lawsuits against Google on Tuesday, accusing Google of allegations against the entire online advertising ecosystem as a detrimental burden on advertisers, consumers and even the U.S. government. tried to break the monopoly.
The government’s complaint alleges that Google is trying to “disable or eliminate” rivals in the online advertising market through acquisitions and to force advertisers to use their own products by making it difficult to use competitors’ products. claimed. It’s part of a slow, albeit new, move by the US to curb the tech giants that have enjoyed nearly unrestricted growth for the past 15 years.
“Monopolies threaten the free and fair markets on which our economy is based. They stifle innovation, hurt producers and workers, and increase costs for consumers,” Merrick said. Attorney General Garland said at a news conference on Tuesday.
According to Garland, for 15 years, Google has “pursued anti-competitive behavior,” thwarting the rise of competing technologies, manipulating the mechanics of online ad auctions, and giving advertisers and publishers access to Google’s tools. have forced the use of In doing so, he added, Google “engaged in exclusionary conduct” that “seriously undermines, if not destroys,” competition in the ad tech industry.
The lawsuit, the latest lawsuit filed by the government against Google, accuses the company of unlawfully monopolizing the way advertising is served online by excluding competitors. Google Ads Manager allows large publishers with a lot of direct sales to manage their ads. Ad exchanges, on the other hand, are real-time marketplaces for buying and selling online display advertising.
According to Garland, Google controls the technology most major website publishers use to sell ad space and the largest ad exchange that connects publishers and advertisers when ad space is sold. . As a result, “website creators earn less and advertisers pay more,” he added.
The lawsuit, filed in federal court in Alexandria, Virginia, sees Google sell its business that controls the technology tools that manage the buying, selling, and auctioning of digital display advertising, as well as Google’s core business of search and other products. Requests to maintain service. Services such as YouTube, Gmail, and cloud services.
Google’s parent company, Alphabet Inc., said in a statement that the lawsuit “replicates a flawed argument that slows down technological innovation, drives up advertising costs and makes growth difficult for thousands of small businesses and publishers. It’s a thing,’ he said. Digital advertising now accounts for about 80% of Google’s revenue, supporting other initiatives that are generally less profitable.
Tuesday’s lawsuit comes as the U.S. government increasingly seeks to curb Big Tech’s dominance, but such legal action could take years to complete, and Congress said the tech It has not passed recent legislation that seeks to curb the influence of the industry’s biggest players.
The European Union is more aggressive. It launched an antitrust investigation into Google’s dominance of digital advertising in 2021. UK and European regulators are investigating whether the agreement between Google and Meta for online display advertising services violates rules on fair competition. I am also investigating.
The Internet services industry group, of which Google is a member, said the lawsuit and its “fundamental structural remedies” were unjustifiable.
Matt Schruers, president of the Computer & Communications Industry Association, said advertising competition is fierce, and that “the government’s argument that digital advertising does not compete with print, broadcast, or out-of-home advertising does not make sense.”
Dina Srinivasan, a fellow at Yale University and an adtech expert, said the lawsuit was “massive.” That’s because the lawsuit is a bipartisan legal assault against Google that unites the entire country, including state and federal governments. In December 2020, 35 states and the District of Columbia sued Google over the exact same issue.
Srinivasan said the current online advertising market is “broken and completely inefficient.” The fact that the intermediary gets his 50% out of his 30% of each ad transaction is “a maddening inefficiency baked into the U.S. economy.” She calls it “free internet and huge taxes on consumers as a whole. It also directly affects the viability of the free press.”
As with many highly complex technology markets, it took federal and state regulators and policymakers time to catch up and understand the online advertising market. Srinivasan noted that it took him a decade before they realized the dangers of high-speed trading in financial markets and began adopting measures to discourage it.
The lawsuit seeks to apply the same rules to the digital advertising market that apply to the financial market, she said. Brokers, banks, and other companies with sometimes competing interests are not allowed to own the New York Stock Exchange.
Google accounts for nearly 29% of the US digital advertising market. This includes all advertisements that people see on their computers. According to research firm Insider Intelligence, by 2022, phones, tablets, and other Internet-connected devices. Facebook’s parent company Meta is his number two, with nearly 20% of his share of the market. Amazon is far away, but a growing third.
But that is not the matter of litigation. It focuses on technical market mechanisms controlled by Google, such as the ad server it developed with his acquisition of DoubleClick, which took the market by storm in 2008. According to the DOJ, Google has more than 90% of his share of the business serving ads on his website and controls more than 80% of his “buy-side” business where advertisers compete to place their ads. doing.
According to the complaint, over the past 15 years, Google has “used its acquisitions and market power in adjacent ad tech markets to quell the rise of competitors, gain greater control over how and how digital ad transactions are conducted, and We have been able to prevent conflicts with publishers.” Advertisers will not be able to work effectively with Google’s rivals. “
This is the latest lawsuit filed against Google by the Department of Justice or local state governments. For example, in October 2020, the Trump administration and her 11 state attorneys general sued Google for violating antitrust laws, alleging anticompetitive practices in the search and search advertising markets.
Assistant Attorney General Jonathan Cantor, the DOJ’s chief antitrust officer, was asked why the DOJ would file a lawsuit when similar complaints had already been filed by states.
States participating in Tuesday’s lawsuit include California, Virginia, Connecticut, Colorado, New Jersey, New York, Rhode Island and Tennessee.
Barbara Ortutay, Eric Tucker, Frank Bajak, Associated Press
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