DOJ Sues Google Again, Attacking Its Online Advertising Dominance

The U.S. Department of Justice and eight states on Tuesday sued Google over its online advertising businessIt abused its monopoly power to the detriment of both advertisers and publishers.

The DOJ’s complaint — which you can read in full below — was filed in federal court in Virginia. It alleges that Google has “distorted legitimate competition in the ad tech industry” by seizing control of online advertising systems and inserting itself into “all aspects of the digital advertising market.” Google is said to have done so by eliminating competition through acquisitions and using its dominance to get advertisers to use its products over those of others. The complaint only names Google as a defendant. It also called for Google to sell part of its ad tech business.

The Justice Department said Google punishes websites that “dare to use competing ad tech products” and uses its dominance in ad tech to “drive more transactions to its own ad tech products and extract inflated fees from its own pockets.” The cost of advertisers and publishers, it is said to serve.”

The case is the latest example of government efforts to regulate big tech. The most financially successful companies on the planet wield immense power over our lives and businesses around the world.

Google denied the allegations.

“Today’s case by the DOJ attempts to pick winners and losers in the highly competitive ad tech industry,” said Google’s advertising chief. Dan Taylor said in a blog post. A judicial case is often a “A baseless case“Written by Texas Attorney General Ken Paxton He was fired In federal court, Google argued that The Justice Department’s case is flawed and will “slow innovation, drive up advertising costs and make growth harder for thousands of small businesses and publishers,” Taylor said.

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The Justice Department did not respond to a request for comment.

While there are some similarities to the Texas case, the Justice Department conducted its own multi-year investigation that found Google maintained “multiple monopolies,” Assistant Attorney General Jonathan Kanter said at a press conference on Tuesday.

The Justice Department’s case is a rare case in which the department has called for the breakup of a major corporation. Its faces include mainframe maker IBM in the 1970s, telephone company AT&T in 1982, and Microsoft, developer of Windows in 2000.

It comes as governments around the world look to rein in Big Tex. The US Senate has been mulling this over the past year American Discovery and Choice Online Act To curb the influence of Amazon, Apple and Google in digital markets. Last year, there was Google Fines imposed in France over user tracking And one agreed $391.5 million settlement with state attorney general over location tracking practices.

Kanter said Google’s dominance in digital advertising is the New York Stock Exchange equivalent of banking firms like Goldman Sachs or Citibank. Google has engaged in this behavior for 15 years, raising ad costs, reducing website revenue, stifling innovation and “equalizing our public marketplace of ideas,” he said. Kanter also accused Google’s conduct of harming the U.S. government and military.

Among the examples of alleged abuse, Google said:

  • Tie-in arrangements were used to lock content creators into Google’s system.
  • Manipulating advertising auctions by providing first-look and last-look advantages over the bidding process.
  • It prevented websites from using competing technology and punished those who tried.
  • Competitors’ bid data was collected and used.
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Kanter used information from Google’s documents and employees to make an argument for the company’s dominance:

  • A Google employee said the company’s ad exchange is an “authorized intermediary.”
  • Senior executives said switching ad servers for publishers was “a nightmare” that would “take an act of God”.
  • A Google executive said, “Our goal is all or nothing. Use Google’s ad exchange or don’t access our advertiser solicitation.”
  • A Google employee said the company “overcharged” advertisers by paying publishers $3 billion a year to stay connected to Google’s ad technology.
  • Detailed steps taken by a Google executive to “dry out” competitors.

The Computer and Communications Industry AssociationDespite some previous support for “appropriate” government intervention, the tech lobby group sided with Google: “This case and the radical structural solutions it presents are unfair. The complaint appears to ignore these dynamics and macro trends of the global ad market,” the group said in a statement.

This is the second antitrust case filed by the Justice Department against Google, but the first by the Biden administration. A October 2020 case During the Trump administration, Google was accused of striking deals with Apple and Samsung to block competitors from being the default search engine on their devices.

Google is also facing A bankruptcy case led by Texas, along with 16 states and territories, the search giant worked with Facebook to give the social network an advantage in online ad auctions. The Justice Department, under the Clayton Antitrust Act, is allowed to sue if the federal government believes it is being harmed.

Last year, Google tried to block the Justice Department lawsuit It plans to spin off its ad tech businessThe Wall Street Journal reported.

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CNET’s Stephen Shankland contributed to this report.

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