US sues Google over digital ad market monopoly

Posted:
in General Discussion edited January 24
The U.S. Department of Justice and eight states have sued Google, over allegations it has an abusive "monopoly power" that makes it impossible for other advertising tools to adequately compete.




Announced via a press conference on Tuesday and a lawsuit filed in the U.S. District Court for the Eastern District of Virginia, the U.S. DoJ and a collection of states all complain that Google is anti-competitive when it comes to the ad business.

"Google's anticompetitive behavior has raised barriers to entry to artificially high levels," the complaint reads, continuing that the tech giant "forced key competitors to abandon the market for ad tech tools, dissuaded potential competitors from joining the market, and left Google's few remaining competitors marginalized and unfairly disadvantaged."

The search company stands accused of making acquisitions to "neutralize or eliminate" competitors, as part of a "cumulative and synergistic effect that has harmed competition and the competitive process."

Along with the DoJ, the commonwealth of Virginia and the states of California, Colorado, Connecticut, New Jersey, New York, Rhode Island, and Tennessee are listed as co-plaintiffs.

The lawsuit has been a long time coming, with murmurs of a lawsuit going back to August 2022.

"Google abuses its monopoly power to disadvantage website publishers and advertisers who dare to use competing ad tech products in a search for higher quality, or lower cost, matches," the filing asserts. "Google uses its dominion over digital advertising technology to funnel more transactions to its own ad tech products where it extracts inflated fees to line its own pockets at the expense of the advertisers and publishers it purportedly serves."

Under the lawsuit, it is asked for the court to order Google into divesting its advertising businesses. While previously Google offered to put its ad auctions business into a separate company to its digital ad serving business, which would've shifted it under parent company Alphabet, the DoJ wants to go further.

This includes the divestiture of "the Google Ad Manager suite, including both Google's publisher ad server, DFP, and Google's ad exchange, AdX," along with any additional structural relied. The complaint also wants the court to rule Google violated the Sherman Act, and to stop being anticompetitive in the ad business.

In a statement to The Verge, Google says "Today's lawsuit from the DOJ attempts to pick winners and losers in the highly competitive advertising technology sector." As well as duplicating an "unfounded lawsuit" from the Texas AG that was mostly dismissed by a federal court, Google further defends its actions.

"DOJ is doubling down on a flawed argument that would slow innovation, raise advertising fees, and make it harder for thousands of small businesses and publishers to grow," the statement continues.

The lawsuit is the latest salvo attacking Google and its ad business in the U.S. In May 2022, senators proposed legislation that would break up the advertising side of big tech firms like Google, in the form of the Competition and Transparency in Digital Advertising Act.

USA versus Google - Another antitrust advertising lawsuit by Mike Wuerthele on Scribd

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Comments

  • Reply 1 of 22
    anonymouseanonymouse Posts: 6,716member
    Calling @gatorguy. Looking forward to your explaining this away. :D  

    ericthehalfbeewatto_cobra
  • Reply 2 of 22
    Never before in history has the United States government been so hostile to its own people. 

    When the government sues private sector companies for being successful, something’s wrong and needs to change. 

    Just because it’s Google this time doesn’t matter. We’ve seen Apple treated like this as well. It’s not right. There is no monopoly. They’re just ahead of everyone else and better at it. That’s not bad. 
    Mig you want to go after google, go after something legit and beneficial to people, such as limiting the invasions of privacy. 

    Don’t sue just to fund your agendas and weaken someone just because they happen to be strong. 
    edited January 24 JaiOh81williamlondonwatto_cobra
  • Reply 3 of 22
    lkrupplkrupp Posts: 10,341member
    @gatorguy in 3…2…1 to explain why his beloved tech giant is innocent and a victim of disinformation by Apple
    edited January 24 ericthehalfbeewatto_cobra
  • Reply 4 of 22
    lkrupplkrupp Posts: 10,341member
    Never before in history has the United States government been so hostile to its own people. 

    When the government sues private sector companies for being successful, something’s wrong and needs to change. 

    Just because it’s Google this time doesn’t matter. We’ve seen Apple treated like this as well. It’s not right. There is no monopoly. They’re just ahead of everyone else and better at it. That’s not bad. 
    Mig you want to go after google, go after something legit and beneficial to people, such as limiting the invasions of privacy. 

    Don’t sue just to fund your agendas and weaken someone just because they happen to be strong. 
    So Theodore Roosevelt was wrong to break up the Standard Oil trust that was strangling the country at the time. And it was wrong to break up AT&T so people could choose other providers and devices
    Oferkestralwilliamlondonwatto_cobra
  • Reply 5 of 22
    avon b7avon b7 Posts: 6,517member
    Never before in history has the United States government been so hostile to its own people. 

    When the government sues private sector companies for being successful, something’s wrong and needs to change. 

    Just because it’s Google this time doesn’t matter. We’ve seen Apple treated like this as well. It’s not right. There is no monopoly. They’re just ahead of everyone else and better at it. That’s not bad. 
    Mig you want to go after google, go after something legit and beneficial to people, such as limiting the invasions of privacy. 

    Don’t sue just to fund your agendas and weaken someone just because they happen to be strong. 
    Where did it say they were suing for being successful? 

    I thought it was about abusing a dominant position. For using that position to stamp out competition. Is that good for the people of the US? 

    Now it will be up to Google to prove the accusations wrong. 
    OferFileMakerFellermuthuk_vanalingamkestral
  • Reply 6 of 22
    DAalsethDAalseth Posts: 2,583member
    lkrupp said:
    Never before in history has the United States government been so hostile to its own people. 

    When the government sues private sector companies for being successful, something’s wrong and needs to change. 

    Just because it’s Google this time doesn’t matter. We’ve seen Apple treated like this as well. It’s not right. There is no monopoly. They’re just ahead of everyone else and better at it. That’s not bad. 
    Mig you want to go after google, go after something legit and beneficial to people, such as limiting the invasions of privacy. 

    Don’t sue just to fund your agendas and weaken someone just because they happen to be strong. 
    So Theodore Roosevelt was wrong to break up the Standard Oil trust that was strangling the country at the time. And it was wrong to break up AT&T so people could choose other providers and devices
    And let’s not forget when they went after Microsoft for abusive behaviour as well.
    Oferkestralwilliamlondonwatto_cobra
  • Reply 7 of 22
    Never before in history has the United States government been so hostile to its own people. 
    These laws have been around for about a century.
    Oferkestralwatto_cobra
  • Reply 8 of 22
    DAalsethDAalseth Posts: 2,583member
    Never before in history has the United States government been so hostile to its own people. 
    You are confusing a private company designed to make money OFF of “the people” with the actual people of the country.
    It is the job of government to reign in abusive powerful organizations, whether it is the cop on the corner cracking down on a bunch of criminals in the neighbourhood, or the DOJ going after a company that has been abusing its market position to the detriment of all. That is the job of government. It is one of the primary reasons we have governments, rather that the law of the gun, and rule of whomever has the biggest gang.
    edited January 24 Oferavon b7FileMakerFellermuthuk_vanalingamkestralwilliamlondonwatto_cobra
  • Reply 9 of 22
    Never before in history has the United States government been so hostile to its own people. 

    When the government sues private sector companies for being successful, something’s wrong and needs to change. 

    Just because it’s Google this time doesn’t matter. We’ve seen Apple treated like this as well. It’s not right. There is no monopoly. They’re just ahead of everyone else and better at it. That’s not bad. 
    Mig you want to go after google, go after something legit and beneficial to people, such as limiting the invasions of privacy. 

    Don’t sue just to fund your agendas and weaken someone just because they happen to be strong. 

    I agree with this lawsuit because it forces everyone to take a hard look at the situation.

    Ironically, many startups are specifically created for the sole purpose of being acquired by bigger companies, yet this also is very definition of anti-competitive behaviour by these big companies.
    FileMakerFellerkestralwilliamlondonwatto_cobra
  • Reply 10 of 22
    gatorguygatorguy Posts: 23,513member
    lkrupp said:
    @gatorguy in 3…2…1 to explain why his beloved tech giant is innocent and a victim of disinformation by Apple
    There's nothing to explain. Politicians have made it clear they intend to reduce the power of Big Tech, companies that are often at odds with governments' agendas. Google is up first, but probably not last. 
  • Reply 11 of 22
    The hard reality the government has to face is that Google has so many users that advertisers must do business with them. Same with Facebook. By capturing user attention to that extent, both companies have a valuable product that advertisers want and simultaneously a massive incentive to keep their users satisfied so they can continue to provide that product.

    The US courts have consistently held that harm to consumers is the determining factor for monopoly abuse. The DoJ is going to have to prove a causal link between Google's advertising business practices and harm to end users, and that's a tough job.
    watto_cobra
  • Reply 12 of 22
    MadbumMadbum Posts: 436member
    You will never see Europeans going after one of their own companies.


    williamlondonwatto_cobra
  • Reply 13 of 22
    avon b7avon b7 Posts: 6,517member
    Madbum said:
    You will never see Europeans going after one of their own companies.


    The vast majority of EU anti trust fines are against EU companies.

    Here is an example;

    https://ec.europa.eu/commission/presscorner/detail/en/IP_14_799

    There are a handful of US companies who normally get whacked with proportionally larger fines simply because their business interests are wider and generate more revenue. Those same companies can be considered repeat offenders and so end up hitting the headlines far more often. 

    EU fines are sometimes a percentage of global revenues as the fines are both punitive and dissuasory. 

    In areas covered by the GDPR, if you check the fine tracker you will see they go right down to private EU individuals. It's the same law for everybody that operates within the EU. 

    Ironically, the US is probably the top player when it comes to imposing unilateral, extraterritorial sanctions with penalties affecting businesses well away from its sovereignty. The EU actually drafted its own legislation to combat that and protect its companies. China has done the same. 

    On top of that, things like FATCA compliance are demanded from sovereign nations to track US financial activity abroad. Compliance alone comes at great cost. I was involved in the FATCA transition process of a multinational insurance company and it was one headache after another. 


    muthuk_vanalingamkestral
  • Reply 14 of 22
    The US courts have consistently held that harm to consumers is the determining factor for monopoly abuse. The DoJ is going to have to prove a causal link between Google's advertising business practices and harm to end users, and that's a tough job.
    Well, who are the consumers? Is it the people who are doing searches with Google and viewing ads or the companies bidding on ad space to display their ads when someone performs a search on Google?

    For reference:

    an article about Google giving Facebook preferential treatment when bidding for ad space, making it harder for smaller ad companies to compete: 

    https://www.nytimes.com/2021/01/17/technology/google-facebook-ad-deal-antitrust.html

    Another about Google manipulating the ad auction in their favor: 

    https://www.adweek.com/media/concern-over-google-ad-auction/ (pay walled, sorry)

    Both of those are examples of Google potentially causing harm to competitors. 

    I mean, I’d argue that me having to view advertisements is causing me harm through wasting my time and costing me resources.  Is that good enough? /s
    watto_cobra
  • Reply 15 of 22
    davidwdavidw Posts: 1,742member
    avon b7 said:
    Never before in history has the United States government been so hostile to its own people. 

    When the government sues private sector companies for being successful, something’s wrong and needs to change. 

    Just because it’s Google this time doesn’t matter. We’ve seen Apple treated like this as well. It’s not right. There is no monopoly. They’re just ahead of everyone else and better at it. That’s not bad. 
    Mig you want to go after google, go after something legit and beneficial to people, such as limiting the invasions of privacy. 

    Don’t sue just to fund your agendas and weaken someone just because they happen to be strong. 
    Where did it say they were suing for being successful? 

    I thought it was about abusing a dominant position. For using that position to stamp out competition. Is that good for the people of the US? 

    Now it will be up to Google to prove the accusations wrong. 
    Wrong! We are not like the EU, even though more and more politicians seems to think that way.

    Here, the accuser still have to prove their accusations are correct. Just because they accuse Google of certain actions, they must still have the evidence to prove it in court. No where has it been stated that the accusers accusations are automatically correct and that any of Google actions are anti-competitive. In the US, under current anti-trust laws, a monopoly is not illegal. And the accuser will have to prove that Google have a monopoly in the online advertising market, under current US anti-trust laws. If they can't, then most, if not all, of their accusations would not be considered anti-competitive. All Google would need to prove is that they do not have a monopoly in the online advertising market. 

    In 2020 the FTC sued Facebook for having a monopoly in the social network market. The suit was tossed because the Federal Judge ruled that the FTC did not have the  evidence to prove their case, that Facebook had an illegal monopoly. Facebook did not have to prove they weren't a monopoly because the accuser did not provide the evidence that they were. The FTC has refiled their case with more evidence and the case is now still pending.

    https://www.npr.org/2021/08/19/1029310979/federal-trade-commission-refiles-suit-accusing-facebook-of-illegal-monopoly

    You have to remember here in the US, we tend to operate under ex post, (after the fact). While in the EU, they tend to operate under ex ante (before the event). While the EU only need to think that a company actions will lead to a violation of anti-trust laws and thus regulations and fines can be levied. In the US, a company is regulated or fined, after their actions led to an anti-trust violation. In the EU, they will go after companies actions with laws, regulations and fines, without ever needing to prove that any anti-trust violation had occurred or will occurred. In the US, we go after companies, only after it's proven that their action led to violation of anti-trust laws. Not that it might.  (About the only time I can think of where the US might exercise ex ante in anti-trust cases, is when approving mergers and acquisitions.)  

    Maybe you are not familiar as to what the Department of Justice is, here in the US. The DOJ is part of the Executive Branch, whose duty is to uphold and enforce Federal laws. The DOJ has nothing to do with the Judicial Branch of the US or make any judicial ruling. The DOJ must still prove their case in a Federal court and if need be, up to the SCOTUS. And the DOJ interpretation of a law might not be how the courts will interpret it. The court interpretation stands. But the DOJ can try to get Congress to change the law or introduce new laws. 
    edited January 25 watto_cobra
  • Reply 16 of 22
    kestralkestral Posts: 285member
    DAalseth said:
    And let’s not forget when they went after Microsoft for abusive behaviour as well.
    They should have broken MSFT up. Bill Gates and his evil company held back innovation for over a decade.
    williamlondonwatto_cobradanox
  • Reply 17 of 22
    anonymouseanonymouse Posts: 6,716member
    gatorguy said:
    lkrupp said:
    @gatorguy in 3…2…1 to explain why his beloved tech giant is innocent and a victim of disinformation by Apple
    There's nothing to explain. Politicians have made it clear they intend to reduce the power of Big Tech, companies that are often at odds with governments' agendas. Google is up first, but probably not last. 
    Nice, Google is an innocent victim of government overreach, nothing to see here.  :D 
    williamlondonwatto_cobraroundaboutnow
  • Reply 18 of 22
    danoxdanox Posts: 1,537member
    Never before in history has the United States government been so hostile to its own people. 

    When the government sues private sector companies for being successful, something’s wrong and needs to change. 

    Just because it’s Google this time doesn’t matter. We’ve seen Apple treated like this as well. It’s not right. There is no monopoly. They’re just ahead of everyone else and better at it. That’s not bad. 
    Mig you want to go after google, go after something legit and beneficial to people, such as limiting the invasions of privacy. 

    Don’t sue just to fund your agendas and weaken someone just because they happen to be strong. 
    You don’t remember Theodore Roosevelt, do you?
  • Reply 19 of 22
    danoxdanox Posts: 1,537member
    The US courts have consistently held that harm to consumers is the determining factor for monopoly abuse. The DoJ is going to have to prove a causal link between Google's advertising business practices and harm to end users, and that's a tough job.
    Well, who are the consumers? Is it the people who are doing searches with Google and viewing ads or the companies bidding on ad space to display their ads when someone performs a search on Google?

    For reference:

    an article about Google giving Facebook preferential treatment when bidding for ad space, making it harder for smaller ad companies to compete: 

    https://www.nytimes.com/2021/01/17/technology/google-facebook-ad-deal-antitrust.html

    Another about Google manipulating the ad auction in their favor: 

    https://www.adweek.com/media/concern-over-google-ad-auction/ (pay walled, sorry)

    Both of those are examples of Google potentially causing harm to competitors. 

    I mean, I’d argue that me having to view advertisements is causing me harm through wasting my time and costing me resources.  Is that good enough? /s
    Everyone knows when you do a search with Google always go to the second page. That’s where you’ll really find what you really want.
  • Reply 20 of 22
    kmareikmarei Posts: 121member
    US sues Google over digital ad market monopoly = fund raising for US politicians
    Guess who's getting campaign contributions from google :)
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