ALBAWABA — The United States Justice Department and eight states sued Google on Tuesday for its dominance of the online advertising market, accusing it of controlling most of the technology used to buy, sell and serve online advertising.
Being the dominant player in the almost $280 billion U.S. digital-ad market. allows Google to keep at least $0.30 out of every dollar advertisers spend through its online advertising tools, the Justice Department said.
The case, which was filed in federal court in Virginia, was launched by the U.S. Justice Department in conjunction with California, Colorado, Connecticut, New Jersey, New York, Rhode Island, Tennessee and Virginia.
The legal battle against the California-based tech giant calls for the breakup of Google’s ad technology business over alleged illegal monopolization of the digital advertising market, marking one of the few times the Justice Department has called for the breakup of a major company since the 1980s when it dismantled the Bell telecom system.
Google uses anticompetitive, exclusionary, and unlawful means to eliminate or severely diminish any threat to its dominance over digital advertising technologies, the federal lawsuit said, accusing the company of unlawfully maintaining a monopoly that “corrupted legitimate competition in the ad tech industry”.
The company’s share of the U.S. digital ad revenue has fallen from 36.7 percent in 2016 to 28.8 percent last year, according to Insider Intelligence.
“The harm is clear: 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 Justice Department said in the complaint. “This conduct hurts all of us.”
Google denied it is a monopoly, saying that the lawsuit “attempts to pick winners and losers in the highly competitive advertising technology sector” while accusing the Justice Department of mischaracterizing how its advertising products work.
Google said the lawsuit “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”.
“No one is forced to use our advertising technologies — they choose to use them because they’re effective,” reiterated Google.
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