Google Faces another lawsuit for ‘driving out’ ad rivals

The US Department of Justice (DOJ) and eight US states have filed a lawsuit against Google, saying that it has too much control over the online advertising market. US Attorney General Merrick Garland said that its actions had “weakened if not destroyed the competition in the ad tech industry”.

Whereas, Google said that the DOJ was “doubling down” on an argument that was wrong. The case tried to “pick winners and losers” in a competitive industry, the firm said.

Insider Intelligence, a market research company says that Google’s total US digital ad income has fallen from 36.7% in 2016 to 28.8% in 2022. But Google is still the market leader. Most of Google’s many billions of dollars in revenue come from online advertising.

Mr. Garland, alleged that Google’s anti-competitive conduct extended into three key areas:

• It controls the technology used by nearly all major website publishers to offer ad space for sale.
• It controls the leading tool used by advertisers to buy ad space.
• It controls the largest ad exchange that matches publishers and advertisers.

Because of Google’s strategy, Mr. Garland said, “website creators make less money and advertisers pay more.” It meant that fewer publishers could offer content without subscriptions, paywalls, or other ways to make money.

Assistant Attorney General Jonathan Kanter said that the company’s actions over 15 years had the effect of “driving out competitors, reducing competition, raising advertising costs, lowering website publisher revenues, stifling innovation, and flattening our public marketplace of ideas.”

But in a statement, Google said the legal action largely duplicates an unfounded lawsuit by the Texas Attorney General, much of which was recently dismissed by a federal court.

“DOJ is doubling down on a weak argument that would slow innovation, raise advertising fees, and make it harder for thousands of small businesses and publishers to grow.”

“DOJ is doubling down on a weak argument that would slow innovation, raise advertising fees, and make it harder for thousands of small businesses and publishers to grow.”

In a blog post, Dan Taylor, vice president of global ads, said that the DOJ’s action would “reverse years of innovation, hurting the advertising sector as a whole.”

Eight countries that filed lawsuit against Google

Google is accused of breaking US antitrust law in the almost 150-page complaint, which aims to “stop Google’s anti-competitive scheme, break Google’s monopolistic hold on the market, and bring back competition to digital advertising.”

If the courts side with the US government, the advertising business of the company would be destroyed. In its complaint, the Justice Department asks the court to force Google to sell off some of its ad business.

The US states of Connecticut, California, Colorado, New Jersey, New York, Rhode Island, Tennessee, and Virginia are also joining the lawsuit.

This new case comes after a 2020 lawsuit was filed against the tech giant during the Trump administration because of its dominance in search.

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