Gannett, the largest U.S. newspaper publisher, has recently filed a civil lawsuit against Google and its parent company Alphabet, accusing them of holding an unlawful monopoly in the digital advertising industry.
The lawsuit claims that Google’s control over advertising technology tools has resulted in reduced revenue for publishers and competitors, while benefiting Google.
This legal action adds to the mounting scrutiny faced by Google, as regulators both in the United States and the European Union are investigating its alleged anticompetitive practices.
Monopolistic Control over Advertising Technology
Gannett alleges that Google exercises control over the sale of ad slots, pressuring publishers to sell increasing amounts of ad space to Google at lower prices.
This practice results in reduced revenues for publishers and disadvantages Google’s ad-tech rivals. Gannett’s lawsuit aims to restore fair competition in the digital advertising marketplace, which it claims has been demolished by Google’s dominance.
Regulatory Scrutiny in the United States and the European Union
Gannett’s lawsuit follows the antitrust lawsuit filed by the U.S. Justice Department and eight states against Google earlier this year. The lawsuit sought to dismantle Google’s alleged monopoly on the entire ecosystem of online advertising, claiming that it harmed advertisers, consumers, and even the U.S. government.
The European Union has also launched an antitrust investigation into Google’s digital ad dominance in 2021. Last week, EU regulators further intensified their actions by issuing fresh antitrust charges against Google and suggesting a potential breakup of its lucrative digital ad business.
CEO’s Concerns and Google’s Response
Mike Reed, CEO of Gannett, voiced his concerns in an opinion piece published by Gannett-owned USA Today. He stated that local news outlets are suffering due to Google’s alleged unlawful bid-rigging practices.
In response, Google’s Vice President of Google Ads, Dan Taylor, argued that publishers have multiple options for using advertising technology and emphasized that Gannett itself utilizes various competing ad services, including Google Ad Manager.
Taylor asserted that publishers retain the majority of revenue when opting for Google tools, and Google’s advertising products benefit publishers in funding their online content.
Legal Action and Seeking Relief
Gannett initiated a lawsuit in the U.S. District Court for the Southern District of New York, aiming to obtain unspecified damages and injunctive relief. The company is adamant about proceeding with a trial by jury, underscoring the importance of the case in potentially transforming the digital advertising industry.
The lawsuit contends that Google’s control over advertising technology tools has resulted in reduced revenue for publishers and benefits for Google. With ongoing antitrust investigations in the United States and the European Union, this legal action represents a significant development in the push for fair competition in the digital advertising marketplace.
As the case unfolds, the outcome could have far-reaching implications for the industry, potentially reshaping the landscape of online advertising.
