Online giants in the US have long had an easy time controlling competition. But now a different wind is blowing in Washington. Google is now increasingly feeling the effects of this.
The US government’s competition watchdog is increasing the pressure on Google with a second lawsuit. This time they accuse the Internet giant of unfair competition in the online advertising market. In the lawsuit published on Tuesday, the US Department of Justice is demanding, among other things, that Google’s division, in which ad technology is bundled, be broken up.
Google has resorted to anti-competitive and illegal methods to eliminate any threat to its own dominance of the online advertising market, it said. Among other things, the Internet group bought up potential rivals at an early stage, is the accusation. The Ministry of Justice criticizes that Google’s actions mean that website operators earn less and advertisers have to pay more. In the end, that hurts everyone.
Google countered that the Justice Department’s lawsuit was “trying to determine winners and losers in the highly competitive advertising technology sector.” It is based on flawed reasoning that would slow down innovation, increase advertising fees and make it more difficult for thousands of small businesses to grow, the company said.
The lawsuit focuses on the so-called “ad tech” market – in particular the technologies for auctions, in which ad spaces are auctioned off in the shortest possible time before a website is displayed to the user.
Google’s concessions were not enough
There have been signs of US government intervention for some time. The “Wall Street Journal” reported last summer that Google had offered the Justice Department as a concession to outsource the “ad tech” division to a separate company. However, it should remain a Google sister company under the umbrella of the Alphabet holding company – and the government’s concessions did not go far enough.
In the first lawsuit in autumn 2020, the US government accused Google of antitrust violations in the online search business during the time of President Donald Trump. It was said that the group was making deals with smartphone providers and network operators in order to give its search engine a special position. Google rejects the allegations. The trial in the case is scheduled to begin this year.
Several US states joined the lawsuit. In addition to New York, this also includes California, where Google has its headquarters. Some states have already filed their own lawsuits against Google in recent years. The company pointed out on Tuesday that the Justice Department’s new lawsuit is largely based on a lawsuit brought by Texas Attorney General Ken Paxton, which was largely dismissed by a court.
US Department of Justice lawsuit
