Google enters a legal turmoil. The US Department of Justice accuses the search engine of using “ anti-competitive and illegal methods to eliminate, or drastically reduce, any threat to its dominance over the technologies used for digital advertising “.
The ministry and eight American states, including California and New York, are asking the courts to condemn the Californian group for violating competition law, to make it pay damages and to order the sale of its activities related to the sale online advertising space.
The complaint explains that Google controls both the technologies used by “ almost all websites to sell banners or pop-ups to brands, the tools advertisers use to buy these spaces, and the market where the transactions take place. “ The damage is clear: website publishers earn less, and advertisers spend more “, Assert the complainants.
” Although Google has faced increased competition in recent years, its market share remains unmatched notes Insider Intelligence analyst Evelyn Mitchell. According to her, the group collects more than a quarter of all digital advertising expenditure and more than half of advertising revenue backed by online searches.
digital advertising, a highly competitive sector according to Google
The Ministry ” tries to pick winners and losers in the digital advertising sector, which is ” already highly competitive “Reacted a Google spokesperson. The company says it believes that if the ministry prevails, its approach would “slow innovation, increase advertising costs, and make it harder for thousands of small businesses and publishers to grow.”
” Competition for ad revenue is fierce online and offline “, supports the CCIA (Computer & Communications Industry Association) in a press release. This professional association which represents the industry believes that the ministry should take into account the entire advertising market, not just the digital part. ” The government’s stance that online pubs do not compete with print, radio, TV and street signs defies reason “, launches the CCIA. But for the ministry and the eight states, it is indeed the internet that is at stake.
” An open internet ” is ” essential to American life »
” An open internet ” is ” essential to American life “, states the complaint in the introduction. The plaintiffs argue that digital advertisements are necessary to fund websites, and that they are ” bought and sold in huge volumes in fractions of a second », according to a very different functioning from that of the printed newspapers or the management of the television channels. ” More than 13 billion advertisements are sold every day on the web in the United States “, add the complainants. They assure that Google has abused its dominant position to exclude its rivals, in particular by “ systematically taking control of a wide variety of high-tech tools used by publishers, advertisers and other market players “.
” We accuse Google of stealing publishers’ revenue for its own profit and punishing those who sought alternatives “says Deputy Minister Vanita Gupta, quoted in a press release. ” These methods have weakened the free and open internet, and increased costs for businesses and the United States government, including the military. “.
Google could be forced to sell part of its advertising business
This is the second complaint launched by the ministry against the Californian group since the inauguration of President Joe Biden two years ago. The first, which relates to the domination of its search engine, should lead to a trial this year. In the United States, the company is already facing lawsuits launched at the end of 2020 by a coalition of states led by Texas.
Google already condemned in France by the Competition Authority
According to their accusations, Google sought to drive out competition by manipulating ad auctions. ” Google should be worried says Evelyn Mitchell. The society ” could be forced to sell part of its advertising businesse “.
Google has already been fined in the past for violating competition law, notably by the European Union. In France, in June 2021, theThe French Competition Authority had fined Google 220 million euros for abuse of a dominant position in the online advertising sector. The American giant, which had not disputed the facts, had undertaken to improve the interoperability of its services with third-party solutions.
In Germany, Paypal is the subject of a procedure for obstacles to competition law
The German Anti-Cartel Office announced earlier this week the opening of proceedings against the American online payment service Paypal for alleged obstacles to competition law in its contracts with online merchants.
This clause ” could therefore restrict competition and constitute an infringement of the prohibition of abuse (of a dominant position) “, estimates Andreas Mundt, the president of the institution. ” If merchants are prevented from considering the costs of different payment methods (…) other platforms could be prevented from emerging in the market “, he developed. If a dominant position is proven, the institution could force Paypal to remove this clause.
This announcement is part of a broad offensive in recent years by the German and European competition authorities against the digital giants.