Google is in hot water after several states file an antitrust lawsuit against its advertising business for alleged anticompetitive practices, allowing the company to have a virtual monopoly over online advertising.
Several state attorneys general, led by Texas Attorney General Ken Paxton, filed an antitrust case against the advertising division of Google for its alleged anti-competitive practices, allowing the company to have a virtual monopoly over online advertising. The complaint focuses on the supposed stranglehold that Google holds on the advertising technology market. Texas AG Paxton announced the filing of the lawsuit in a video clip, although he did not reveal the full details of the complaint as of posting.
In the video clip where he announced the filing of an antitrust lawsuit against Google for alleged anti-competitive practices and having a virtual monopoly of online advertising, Paxton said that the company continuously uses its power to maintain control over pricing. The Texas AG also said that Google allegedly engages in market collusion to fix auctions, adding that the company eliminated its rivals and made itself the king of online advertising. "If the free market were a baseball game, Google positioned itself as the pitcher, the batter and the umpire," the Texas AG said.
Paxton also revealed that several other states have joined Texas in the filing of its case. The Texas AG, however, has yet to identify the states involved in the filing of the antitrust case against Google for alleged anti-competitive practices and its supposed virtual monopoly of online advertising. Sources told CNBC that all the other states that joined the filing are all Republican-led. Paxton is also involved in another antitrust lawsuit with the social media giant, Facebook.
Texas, backed by nine other states, filed a lawsuit against Google accusing it of breaking antitrust law in how it runs its online advertising business https://t.co/3yMmqsYq6b pic.twitter.com/uYolBIPY5O — Reuters (@Reuters) December 17, 2020
The new complaint against Google comes on the heels of another antitrust lawsuit filed by the Department of Justice against the Mountain View-based tech giant. The antitrust case filed by the DOJ against the search and advertising monolith focuses on Google's search business. On top of all these, the Justice Department is also investigating the ad tech dominance of Google, and yet another lawsuit could ensue from that investigation. Legal luminaries say that even if several states already filed an antitrust lawsuit against Google for alleged anti-competitive practices and having a virtual monopoly of online advertising, the Department of Justice can still file a similar, yet separate, case on its own.
Sources privy to the complaint revealed that the case filed by Texas AG Paxton and other attorneys general stemmed from the move of Google to make a deal with Facebook as regards online advertising several years back. At the time, Facebook is emerging as a potent advertising rival to Google, forcing the latter to initiate an agreement with Facebook where the social media giant will limit its competitive acts and in return, the search engine giant guarantees special treatment to Facebook in Google-run ad auctions. Google and Facebook did not comment on the lawsuit and just said they will answer the allegations in due time.
