In the United States, a coalition of states has filed a new version of a legal complaint accusing Google and Meta of having entered into an illegal agreement in 2018 aimed at establishing their domination of the online advertising market.
A coalition of states led by Texas filed on January 14 in a New York court a new version of a text of lawsuits initially launched against Google in December 2020. According to the text, the most senior leaders of Google and de Meta (parent company of Facebook) would have entered into an illegal agreement in 2018 to establish their domination of the online advertising market.
According to the charges, Google sought to foreclose competition by manipulating ad auctions through the algorithm that determines which ads are displayed on web pages based on the user’s anonymized profile.
The legal documents revealed on January 14 clearly refer to Google bosses Sundar Pichai and Philipp Schindler, as well as Sheryl Sandberg, Facebook’s chief operating officer, even though her name is crossed out with a thick black line.
“These negotiations resulted in September 2018 in an agreement between Google and Facebook signed by Philipp Schindler, vice president and director of sales and operations of the Google advertising branch, and a Madame X, director of operations and member of the board of administration of Facebook, which had itself for a time directed advertising at Google”, detail the state prosecutors. “Google CEO Sundar Pichai also personally approved the terms of the agreement,” they added. The complaint also cites an email from Sheryl Sandberg to Mark Zuckerberg, where she describes the project as “strategically very important.”
An abuse of a dominant position?
According to the prosecution, Google was concerned that an alternative system for allocating advertising space was being adopted too widely, allowing site publishers to circumvent its commissions. The Californian group would then have convinced its “competitor” to form an alliance.
“The non-exclusive agreement with Google and similar agreements we have with other auction platforms have helped strengthen competition for ad placements,” a Meta spokesperson said. “These professional relationships allow Meta to provide more value to advertisers while compensating publishers fairly: everyone wins,” he continued.
Google for its part denounced a complaint “riddled with inaccuracies and without legal basis”. “Online advertising is a fiercely competitive industry, which has lowered advertising costs and given publishers and advertisers more choice. We will continue to strongly defend ourselves against these unfounded allegations in court,” a spokeswoman told AFP on January 14.
On the role played by Sundar Pichai, she clarified that “every year hundreds of agreements that do not require the approval of the CEO” are signed. “It was no different in this case. And contrary to the assertions of the attorney general, this agreement was never a secret”.
The two giants of the new technologies sector, as well as Apple and Amazon, are accused of abuse of dominant position by a growing number of authorities in the United States. Google holds 28.6% of the global digital advertising market in 2021, according to the firm eMarketer, just ahead of its supposed rival Facebook and its 23.7% market share.
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