8 States vs. Google: A Closer Look At The DOJ’s Antitrust Lawsuit

After slashing 12,000 layoffs on January 20, the US Department of Justice officially filed an antitrust lawsuit against Google this week.

With rumors of a potential lawsuit circulating for so long, this move from the DOJ isn’t unexpected.

The lawsuit contains allegations that the tech company has a monopoly on the existing digital advertising ecosystem.

8 states join a new lawsuit

Eight states have so far joined the Department of Justice in the lawsuit. They include:

• Virginia
• California
• Colorado
• Connecticut
• New Jersey
• New York
• Rhode Island
• Tennessee

Remember, this lawsuit is separate from the first lawsuit by the Department of Justice again in 2020 against Google.

In the 153-page document, the DOJ argues that Google has created an advertising environment that unfairly favors its Alphabet-owned products.

Going into more detail, the DOJ says:

Google, one company with pervasive conflicts of interest, controls: (1) the technology used by nearly every major website publisher to offer ad space for sale; (ii) the leading tools advertisers use to purchase that ad space; and (3) the largest ad exchange that matches publishers to advertisers each time that ad space is sold.

Speaking of the monopoly accusation, the complaint states:

Google uses its monopoly power to harm website publishers and advertisers who dare use competing ad technology products in search of a higher-quality or lower-cost match. Google is using its dominance in digital advertising technology to funnel more transactions into its advertising technology products as it extracts inflated fees to line its own pockets at the expense of the advertisers and publishers they purport to serve.

Google is responding publicly to the allegations

After the news broke, Google released its official one statement In this regard.

Their main points for the lawsuit focus on the following:

• Government control within a competitive industry
• Rewrite history and reverse innovation

Dan Taylor, Vice President of Global Advertising, Google, stated:

We are one of the hundreds of companies that make it possible to place ads online. It has been reported that the competition is increasing as more and more companies enter and invest in building their advertising business.

He gave examples of increased competition over the past few years, such as Apple and Amazon increasing investments in their own advertising platforms and other media companies such as Comcast and Disney.

Where does this leave the advertising industry?

If Google is found guilty in this lawsuit, it would likely mean the reversal of 15-year acquisitions like AdMeld and DoubleClick.

If closed, it is difficult to say how directly it will affect the advertising techniques within the Google Ads platform, among other things used by marketers.

Google also states that a ruling against Google would harm the broader advertising sector, “making it difficult for Google to provide effective advertising tools that benefit publishers, advertisers, and the broader American economy.”

summary

The lawsuit against Google is still in its early stages. It is unlikely that any drastic changes will happen in the near future.

We will continue to update as more information becomes available.

You can read the full lawsuit document here.

Featured image: Sergei Elagin/Shutterstock