The US justice department and eight states have filed a lawsuit against Alphabet-owned tech giant Google, alleging that it abused its dominance of the digital advertising business.
The government believes that Google has had plans to “neutralize or eliminate” rivals through acquisitions and by forcing advertisers to use its ad products by making it increasingly hard to use competitor’s services.
“Google has used anticompetitive, exclusionary, and unlawful means to eliminate or severely diminish any threat to its dominance over digital advertising technologies,” the government said according to The Guardian.
Filed in federal court in Alexandria, Virginia, the antitrust lawsuit comes as part of a wider campaign to scrutinise large tech companies that have experienced ‘unbridled growth in the past 15 years.
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Attorney general Merrick Garland added: “for 15 years, Google has pursued a course of anti-competitive conduct.
“Google has engaged in exclusionary conduct. First, Google controls the technology used by nearly every major website publisher to offer advertising space for sale. Second, Google controls the leading tool used by advertisers to buy that advertising space. And third, Google controls the largest ad exchange that matches publishers and advertisers together each time that ad space is sold.
The justice department and eight states – including California, Virginia, Connecticut, Colorado, New Jersey, New York, Rhode Island and Tennessee – have asked the court to encourage Google to give details about its Google Ad manager suite, including its exchange AdX.
Alphabet responded to the suit by stating that it “doubles down on a flawed argument that would slow innovation, raise advertising fees, and make it harder for thousands of small businesses and publishers to grow”.
According to The Guardian, digital advertisements currently account for around 80% of Google’s revenue.
In November, Google was sued by a group of UK-based website publishers who claimed that the company and its parent firm Alphabet abused their dominant position in online advertising, limiting their revenue.
Law firms Geradin Partners and Humphries Kerstetter revealed in a statement that the class action claim was filed at the Competition Appeal tribunal by 130,000 businesses publishing around 1.75 million websites and apps in the UK. It is suggested that the tech firm’s actions may have reduced advertising revenue by up to 40% for some companies.
