Following the curtails of a 12,000-employee layoff on January 20th, the U.S. Department of Justice formally submitted an antitrust suit against Google this week.
With rumors swirling about a possible claim for quite a while, this move from the DOJ is not unexpected.
The lawsuit has allegations worrying the tech business’s monopoly on the present digital advertising environment.
8 States Join New Lawsuit
Eight states so far have actually signed up with forces with the DOJ on the claim. They include:
- New Jersey
- New York
- Rhode Island
Bear in mind that this claim is separate from the very first suit from the DOJ back in 2020 against Google.
In the 153-page document, the DOJ argues that Google has created an advertising environment that prefers its Alphabet-owned products unfairly.
Entering into further detail, the DOJ states:
Google, a single business with pervasive disputes of interest, now manages:-LRB- 1) the innovation utilized by almost every major website publisher to use marketing area for sale; (2) the leading tools utilized by marketers to buy that marketing space; and (3) the biggest advertisement exchange that matches publishers with advertisers each time that advertisement area is offered.
Speaking with the monopoly allegation, the problem additional states:
Google abuses its monopoly power to downside site publishers and advertisers who attempt to utilize completing advertisement tech products in a look for greater quality, or lower cost, matches. Google utilizes its dominion over digital advertising innovation to funnel more deals to its own advertisement tech items where it extracts inflated charges to line its own pockets at the cost of the marketers and publishers it purportedly serves.
Google Openly Responds To Allegations
After the news broke, Google released its main declaration on the matter.
Their main counterpoints to the lawsuit concentrate on the following:
- Government’s control within a competitive industry
- Rewriting history and reversing development
Dan Taylor, Vice President, Global Ads of Google, mentioned:
We are one of hundreds of companies that allow the positioning of advertisements throughout the Internet. And it’s been well reported that competitors is increasing as increasingly more companies go into and invest in constructing their advertising organizations.
He supplied examples of the increased competition over the past few years, such as Apple and Amazon’s increased financial investment in their advertising platforms and other media companies like Comcast and Disney.
Where Does This Leave The Advertising Industry?
If Google is condemned in this suit, that would likely imply the reversal of 15-year acquisitions such as AdMeld and DoubleClick.
If those are closed down, it’s hard to say just how much it would directly affect advertising technologies within the Google Advertisements platform, among others that online marketers use.
Google also specifies that a judgment versus Google would damage the broader marketing sector, “making it harder for Google to use effective advertising tools that benefit publishers, advertisers and the broader U.S. economy.”
The lawsuit filing versus Google is still in its early stages. It’s unlikely that any extreme modifications will happen in the immediate future.
We’ll continue to update as more details is offered.
You can check out the full suit file here.
Included Image: Sergei Elagin/SMM Panel