Tech giant Google has been under a lot of pressure from global regulators recently, which includes a number of legal complaints and lawsuits against the company.
The latest lawsuit is being led by Texas and ten other US states, which are accusing Google of illegally taking steps to preserve its position in the online advertising industry.
Among the accusations, the courts accuse Google of collaborating with Facebook in order to manipulate advertising auctions and maintain a monopoly in this area.
What are the claims?
Ten US states – Texas, Indiana, Missouri, Arkansas, Kentucky, Mississippi, North Dakota, South Dakota, Idaho, and Utah – are suing Google over claims that it’s using its market position to give itself an unfair advantage over competitors.
The lawsuit primarily focuses on Google’s role in the online advertising market. At the moment, the company’s advertising sales make up over 80% of its revenue.
Some examples that will be included in the lawsuit include the 2008 purchase of DoubleClick and the steps that were taken to undercut competitors and alternative software.
In a Twitter post, Texas Attorney General Ken Paxton said, “Google repeatedly used its monopolistic power to control pricing, engage in market collusion to rig auctions in a tremendous violation of justice.”
He added, “Right now, when you visit the website of a news outlet you know and trust, like the Wall Street Journal or your favourite local paper, you’ll see advertisements likely placed there by Google.”
“But Google doesn’t tell you – the public – that they manipulate the advertising auctions, and they continually illegally profit by taking money away from those web pages and putting it in their own pockets.”
How has Google responded?
Google says it will be defending itself in court and denies the claims. In a statement, a spokesperson said, “We’ve invested in state-of-the-art ad tech services that help businesses and benefit consumers.”
“Digital ad prices have fallen over the last decade. Ad tech fees are falling too. Google’s ad tech fees are lower than the industry average. These are the hallmarks of a highly competitive industry.”
Although Google has rejected all the claims, prosecutors say they will be pushing for tough action including more regulations in the future to protect smaller businesses.
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