Several states including New York, Colorado, Virginia, and California have joined with the Department of Justice to sue Google, charging that the online giant is illegally monopolizing the market for online ads.
Claims include “self-dealing, anticompetitive acquisitions, and forcing businesses to use multiple products and services that it offers,” according to a new report in Politico.
The report noted that the legal fight “could lead to a breakup of Google’s massive advertising business.”
It’s not the first time the government would have taken such action. Decades back, the AT&T monopoly on telephone services was busted up, leading to a long list of competitive companies and services now available in that industry.
And it’s not the only challenge to Google’s ad dominance that has been brought.
Politico explained, “It’s both the DOJ’s second case and the second case targeting its ad business. The DOJ and a group of state attorneys general sued in October 2020 over Google’s dominance in web searches, and a Texas-led group of state attorneys general challenged its advertising business later that year. Yet another case was filed by a Utah-led group of states last year over Google Play, its mobile app store.”
CNBC said that the case is “the latest sign that the U.S. government is not backing down from cases against tech firms even in light of a mixed record in court on antitrust suits.”
That report explained Google’s advertising business generated $54.5 billion in the quarter that ended Sept. 30 from Search, YouTube, Google Network ads, and other advertising.
Critics have complained about the company’s operations because it “operates on multiple sides of the market — buying, selling and an ad exchange,” and that gives it unique insight into the process as well as “potential leverage.”
Google has claimed it does not dominate the online ad market.
But the new DOJ complaint cites the company’s desire to “control all sides of the market” so that it “would no longer have to compete on the merits; it could simply set the rules of the game to exclude rivals.”
Google is charged with creating circumstances where “website creators earn less, and advertisers pay more than they would in a market where unfettered competitive pressure could discipline prices and lead to more innovative ad tech tools that would ultimately result in higher quality and lower cost transactions for market participants.”
The new complaint charges Google acquired, then extinguished, “any competitive threat.”
A Google official said the claims are largely “unfounded.”
CNN reports that one of the government’s requests in the lawsuit, filed in Virginia, is for Google to be broken up.
The report said Google took in $209 billion in ad revenues in 2021.
The European Union and the United Kingdom already had started court cases on related issues.
via wnd
