Google and Facebook have reportedly already reached an agreement to tackle antitrust action from a large number of US states.
Last week ten US States including Texas, Arkansas, Indiana, Kentucky, Missouri, Mississippi, South Dakota, North Dakota, Utah and Idaho, had filed a lawsuit, alleging Google colluded with Facebook to break US antitrust law to bolster its online advertising business.
That was Google’s third antitrust lawsuit since October, when the US Justice Department had sued Google – alleging it was abusing its market dominance to weaken rivals’ positions.
The second lawsuit (also filed last week) was filed by 38 US states led by Arizona, Colorado, Iowa, Nebraska, New York, North Carolina, Tennessee and Utah, had alleged that Google illegally maintained a monopoly in general search and search advertising via anticompetitive conduct and contracts.
But this joint agreement concerns the Texas, Arkansas, Indiana etc lawsuit that argues Google colluded with Facebook to bolster its online advertising business.
Google as is widely known, controls a third of the global online advertising industry, but the complaint alleged that Google abuses its ownership of digital ad marketplaces to unfairly enrich itself at the expense of fair competition.
The lawsuit alleged that Facebook and Google, used a series of deals to consolidate their market power illegally.
The lawsuit cited a publicised deal in 2018 between Google and Facebook, and alleged the deal began to give Facebook’s advertiser clients the option to place ads within Google’s network of publishing partner.
The complaint also alleged that Google gave Facebook preferential treatment in this deal, and that Facebook alleged agreed to back down from supporting competing software, which publishers had developed to dent Google’s market power.
But now according to the Wall Street Journal, Google, Facebook had already agreed to team up against possible antitrust action.
Essentially, Facebook and Google had agreed to “cooperate and assist one another” in case of an investigation into their pact to work together in online advertising, the Wall Street Journal reported late on Monday.
The WSJ reported that the US state lawsuit had said that Google and Facebook were aware that their agreement could trigger antitrust investigations, and had discussed how to deal with them.
A Google spokesperson told the WSJ that such agreements over antitrust threats are extremely common.
The WSJ reported that Facebook’s Chief Operating Officer Sheryl Sandberg had signed the deal with Google.
The US state lawsuit also cites an email in which Sandberg told Facebook CEO Mark Zuckerberg and other executives that “this is a big deal strategically.”
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