The US Department of Justice and eight states on Tuesdayclaiming that the company abused its monopoly power and harmed 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 “corrupted legitimate competition in ad technology” by seizing control of online advertising systems and “investing itself in every aspect of the digital advertising market”. Google allegedly did this by eliminating competition through acquisitions and using its dominance to push advertisers to use its products over those of others. The complaint names only Google as a defendant, and not any individual. It also calls for Google to sell off part of its ad tech business.
The Justice Department also said that Google penalizes sites that “dare to use competing ad technology products” and uses its ad technology dominance to “shift more transactions to its own ad technology products where it charges inflated fees to its to line the pockets.” the costs of the advertisers and publishers it purports to serve.”
The case is the latest example of government efforts to rein in Big Tech. The most financially successful companies on the planet have enormous power over our lives and businesses around the world.
Google denied the allegations.
“Today’s court action seeks to pick winners and losers in the highly competitive ad technology industry,” Google advertising chief Dan Taylor said in a blog post. The Justice Department’s lawsuit largely echoes a “frivolous lawsuit” by Texas Attorney General Ken Paxton that was dismissed in federal court, Google argued. The Justice Department’s case is flawed and will “slow innovation, raise advertising fees and make it harder for thousands of small businesses and publishers to grow,” Taylor said.
The Ministry of Justice did not respond to a request for comment.
While there are some similarities to the Texas case, the Justice Department’s own years-long investigation found Google maintained “numerous monopolies,” Assistant Attorney General Jonathan Kanter said at a news conference Tuesday.
The Justice Department’s lawsuit is a rare instance of the agency calling for the breakup of a major company. Other cases include his confrontations with major manufacturer IBM in the 1970s, phone giant AT&T in 1982, and Windows maker Microsoft in 2000.
It comes as governments around the world seek to rein in Big Tech. The US Senate has been thinking for the past yearTo curb the influence of Amazon, Apple and Google in digital markets. Last year, Google was and agreed to A .
Kanter said Google’s dominance in digital advertising is on par with banking firms such as Goldman Sachs or Citibank, which are owned by the New York Stock Exchange. Google has been behaving like this for 15 years, inflating ad spending, reducing website revenue, stifling innovation and “flattening our marketplace of public ideas,” he said. Kanter also claims that Google’s behavior harmed the US government and military.
Among examples of alleged abuse, Kanter told Google:
- Used connection settings to block content creators on Google’s system.
- Manipulating advertising auctions to give itself first-look and last-look advantages over the bidding process.
- Blocked websites from using competing technologies and penalized those who tried.
- Collected and used competitor bidding data.
Kanter also used information from Google documents and employees to make the case for the company’s dominance;
- One Google employee said the company’s ad exchange is “an authoritarian middleman.”
- Senior executives say switching ad servers for publishers is a “nightmare” that “requires an act of God”.
- The manager of Google said: “Our goal should be all or nothing. Use the Google Ad Exchange or opt out of our advertiser requirements.”
- A Google employee says the company “extorts” $3 billion a year from advertisers by passing the money on to publishers to stick with Google’s ad technology.
- Google’s executive is taking detailed steps to “dry out” competitors.
The Computer and Communications Industry Association, a technology lobby group, joined Google despite some previous support for “appropriate” government intervention; screens of all sizes, and the complaint appears to ignore these dynamics as well as macro trends in the global advertising market,” the group said in a statement.
This is the second antitrust lawsuit filed by the Justice Department against Google, but the first from the Biden administration. AnUnder speculation under the Trump administration, Google has locked out competitors by striking deals with Apple and Samsung to be the default search engine on their devices.
Google is also standing byAlong with 16 states and territories, alleging that 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 also allowed to sue if the federal government believes it has been harmed.
Last year, Google tried to beat back the Justice Department’s lawsuitThe Wall Street Journal reports.
CNET’s Stephen Shankland contributed to this report.