Newspaper publisher Gannett files lawsuit against Alphabet’s Google, and alleges monopoly of online advertising sector
Alphabet’s Google is once again facing legal trouble over its position in the online advertising industry.
The largest newspaper publisher in the United States, Gannett, announced on Tuesday that it has filed a lawsuit against Google in a Manhattan federal court.
Gannett, which has more than 200 daily newspapers including USA Today, said the lawsuit was because of Google’s alleged “monopolisation of advertising technology markets and deceptive commercial practices.”
Gannet said the lawsuit seeks to restore competition in the digital advertising marketplace and end Google’s alleged monopoly, which will encourage investment in newsrooms and news content throughout the country.
Gannet said that publishers depend on digital advertising revenue and that “Google’s practices have depressed revenue and impacted local newsrooms adversely by monopolising the markets for important software and technology products that publishers and advertisers use to buy and sell ad space.”
The publisher said that Google controls 90 percent of the market for “publisher ad servers,” which publishers use to offer ad space for sale. It added that Google also controls over 60 percent of the market for “ad exchanges,” which run auctions among advertisers bidding for ad space on publishers’ websites.
“Google controls the largest source of advertisers bidding on exchanges,” said Gannet. “For Gannett, 60 percent of all buyers come through Google. The result is Google unfairly controlling selling, buying, and the exchange that matches sellers and buyers – and manipulating all aspects of online advertising transactions.”
Gannett said it is seeking “very substantial” actual, punitive and triple damages.
“Google has monopolised market trading to their advantage and at the expense of publishers, readers and everyone else,” said Michael Reed, Gannett Chairman and CEO.
“Digital advertising is the lifeblood of the online economy. Without free and fair competition for digital ad space, publishers cannot invest in their newsrooms.”
“For more than a hundred years, Gannett has been a tireless advocate for freedom of the press empowering communities to thrive,” said Reed. “This lawsuit seeks to ensure we can continue our mission for hundreds of years more.”
The publisher alleged that in 2022, Google made upwards of $30 billion in revenue from the sale of ad space on publishers’ websites which was six times the digital advertising revenue of all US news publications, combined.
The American publisher also pointed out that in December 2020, a bipartisan group of 17 State Attorneys General filed a lawsuit against Google raising similar allegations of ad tech monopolisation.
The US Department of Justice, joined by a bipartisan coalition of 17 additional States, filed its own ad-tech lawsuit against Google in January this year.
The DoJ and EU are currently seeking a breakup of Google’s ad-tech business, in addition to monetary damages and fines.
Last week, the European Commission last week warned Alphabet’s Google division of antitrust violations in its ad tech business.
In June 2021 when the European Commission had began its probe into whether “Google violated EU competition rules by favouring its own online display advertising technology services in the so called ‘ad tech’ supply chain, to the detriment of competing providers of advertising technology services, advertisers and online publishers.”
Then in August 2022 the EC broadened its ad tech investigation of Google when it took over a Portuguese probe into Google’s digital advertising business.
The UK’s Competition and Markets Authority (CMA) meanwhile in May 2022 also announced it was investigating Google’s dominance in advertising technology.
Then in April 2023 Google was hit by a second major collective lawsuit in the UK over its advertising practices.
The £3.4 billion lawsuit, brought by former Guardian technology editor Charles Arthur, claimed Google’s dominance of the ad tech industry had illegally reduced publishers’ income from ad revenues.