On Tuesday, the US Department of Justice and eight statesargued that it 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. Google is alleged to have “disrupted 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 allegedly did this by eliminating competition through acquisitions and using its dominance to induce advertisers to use their products over those of others. The complaint only names Google as a defendant, not anyone else. He is also calling for Google to sell part of its ad tech business.
The Justice Department also said that Google penalizes websites that “dare to use competing ad technology products” and uses its ad technology advantage “to drive more traffic to its own ad technology products, where it charges inflated fees to line its own pockets. Advertisers and the expenses of the publishers it purports to serve.”
The case is the latest example of the government’s efforts to rein in Big Tech. The most financially successful companies on the planet wield enormous power over our lives and businesses around the world.
Google has denied the claims.
“Today’s DOJ filing seeks to pick winners and losers in the highly competitive ad tech sector,” Google ads leader Dan Taylor said in a blog post. According to Google, the Justice Department’s lawsuit is a repeat of a “frivolous lawsuit” dismissed in federal court by Texas Attorney General Ken Paxton. 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 conducted its own years-long investigation that found Google held “numerous monopolies,” Assistant Attorney General Jonathan Kanter said at a news conference Tuesday.
The Justice Department lawsuit is a rare case in which the administration has called for the dissolution of a major company. Other examples include encounters with mainframe maker IBM in the 1970s, telephone giant AT&T in 1982, and Windows creator Microsoft in 2000.
This comes at a time when governments around the world are trying to rein in Big Tech. The US Senate has been thinking about it for the past yearCurbing the influence of Amazon, Apple and Google in digital markets. Last year it was Google and agreed .
Kanter said Google’s dominance in digital advertising is on par with banking firms like Goldman Sachs or Citibank, which owns the New York Stock Exchange. Google has engaged in this behavior for 15 years, inflating ad spending, reducing website revenue, stifling innovation and “shaping our marketplace of public ideas,” he said. Kanter also argued that Google’s behavior harmed the US government and military.
Among the examples of alleged abuse, Kanter told Google:
- Lockout arrangements have been used to lock content creators into the Google system.
- Manipulated advertising auctions by giving themselves first-view and last-view advantages in the bidding process.
- It blocked websites from using competing technology and penalized those who tried.
- Collected and used competitors’ tender data.
Kanter also used Google documents and employee data to make an argument for the company’s superiority:
- A Google employee said the company’s ad exchange was an “authoritarian intermediary.”
- Senior executives said switching ad servers for publishers was a “nightmare” that was “an act of God”.
- A Google executive said: “Our goal should be all or nothing. Use Google’s ad exchange or get no access to our advertiser demand.”
- According to a Google employee, the company has “already paid” $3 billion a year from advertisers, which it passes on to publishers to keep Google’s ad technology.
- The head of Google took detailed steps to “dry” competitors.
The Computer and Communications Industry Association, a tech lobby group, has sided with Google despite some earlier support for “appropriate” government intervention: “We find this claim and the radical structural measures it proposes to be unfounded. Digital services compete fiercely for advertising dollars.” .There are screens of all sizes, and the complaint appears to ignore these dynamics, as well as the macro trends of the global advertising market,” the group said in a statement.
This is the second antitrust lawsuit the Justice Department has brought against Google, but the first since the Biden administration. MomentHe claimed that during the Trump administration, Google blocked competitors by making deals with Apple and Samsung.
Google also faces, along with 16 states and territories, claimed the search giant was working with Facebook to give the social network an edge in online ad auctions. According to the Justice Department, the Clayton Antitrust Act also allows the federal government to sue if it believes it has been harmed.
Last year, Google tried to stop the Justice Department’s lawsuitThis was reported by The Wall Street Journal.
CNET’s Stephen Shankland contributed to this report.