The Justice Department accuses Google of monopolizing advertising technology
The Justice Department and eight states sued Google on Tuesday, alleging the internet giant has an illegal monopoly over online advertising.
It is the fifth federal antitrust lawsuit against the Alphabet-owned company since 2020, when the DOJ sued it over an alleged search monopoly.
By buying up competitors and directing potential customers to its own products, Google has “corrupted legitimate competition in the ad tech industry,” the government said in its complaint.
“Google is using its dominance over digital advertising technology to funnel more transactions to its own ad tech products, where it charges inflated fees to line its own pockets at the expense of the advertisers and publishers it claims to serve,” it said it in suit.
The company makes more than 80% of its revenue from advertising, totaling $209 billion in 2021, the latest year available.
Hamper the free market?
“Google has thwarted meaningful competition and discouraged innovation in the digital advertising industry, hogging cross-competitive gains and preventing the free market from functioning fairly to support the interests of the advertisers and publishers that make today’s powerful Internet possible.” the Justice Department reportedly.
Tuesday’s lawsuit, filed in the Eastern District of Virginia, was joined by the states of California, Colorado, Connecticut, New Jersey, New York, Rhode Island, Tennessee and Virginia.
Google denies that its advertising practices harm competition.
“Today’s lawsuit by the DOJ seeks to determine winners and losers in the highly competitive advertising technology sector. It largely repeats a baseless lawsuit brought by the Texas Attorney General, much of which was recently dismissed in a federal court,” the company said in a statement. “The DOJ reinforces a flawed argument that would slow innovation, increase advertising fees, and make it harder for thousands of small businesses and publishers to grow.”
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Antitrust advocates have expressed their support for the government’s recent lawsuit against Google.
“Today’s lawsuit by the Department of Justice against Google for monopolizing advertising will be remembered as one of the most important antitrust cases in American history,” Barry Lynn, executive director of the Open Markets Institute, said in a statement.