The US Department of Justice filed an antitrust lawsuit against Google, leveling the long-held charge that the tech giant’s monopolistic online advertising framework prevents competitors. The lawsuit, in which eight other US states also join, is aimed at breaking up the Google’s online ad business, Yahoo Finance reported.
“Google’s anticompetitive behavior has raised barriers to entry to artificially high levels, forced key competitors to abandon the market for ad tech tools, dissuaded potential competitors from joining the market, and left Google’s few remaining competitors marginalized and unfairly disadvantaged,” the DoJ lawsuit says.
“Google has thwarted meaningful competition and deterred innovation in the digital advertising industry, taken supra-competitive profits for itself, and prevented the free market from functioning fairly to support the interests of the advertisers and publishers who make today’s powerful internet possible,” it adds.
According to the lawsuit, Google, which is illegally using its monopoly power, must spin off entities like Google Ad Manager suite that includes Google’s publisher ad server DFP and Google’s ad exchange AdX, the report says.
In December 2020, Texas and nine other US states said Google and Facebook carved up the huge online advertising market through unlawful and unholy means. Under the secret deal struck between the two heavyweights in 2018, the companies decided to two made a secret pact to divide up the market for ads on websites and apps between them, the Texas complaint said.
In a separate antitrust suit field in October, the Justice Department said Google got into a secret arrangement with Apple to make sure it continued to dominate the search engine space.
In July 2020, Congress Subcommittee for Judiciary Antitrust, Commercial and Administrative Law had grilled the CEOs of Facebook and Google, along with the head honchos of Apple and Amazon, as part of its historic antitrust hearing.
“As internal Google documents reveal, Google sought to kill competition and has done so through an array of exclusionary tactics, including an unlawful agreement with Facebook, its largest potential competitive threat,” the Texas lawsuit said.
More Pressure on Google
Industry watchers say the new Justice Department will increase pressure on Google. “The multiple actions expand the scope of the litigation for Google, and the greater scope somewhat increases its litigation burden … Reaching negotiated settlements becomes harder as the number of plaintiff groups increases,” Pennsylvania State University law professor John Lopatka told Yahoo News.
In the last ten years or so, Google was fined roughly $10 billion by the European Commission, the report says. Also in 2017, Google fined for allegedly abusing its market dominance in search. In 2018 the tech giant was in the dock for allegedly misusing its market dominance in the mobile space.