The largest newspaper publisher in the entire country has sued Google over allegations that the company violates antitrust laws when it comes to controlling tools used to buy and sell ads.
Gannett filed the lawsuit on Tuesday against Google and its parent company, Alphabet, alleging that it controls how publishers sell ad space and forces them to sell ever more ad space to Google at lower prices, leading to less revenue for the publishers and the company’s ad-tech rivals.
Gannett CEO Mike Reed explained the rationale for the lawsuit in an article in USA Today, saying that news publishers’ ad revenue has fallen significantly as Google owns 90 percent of the market for “publisher ad servers,”[ads1]; where publishers sell ad space online. .
“Google’s practices have real-world implications that not only reduce revenue, but also force the reduction and footprint of local news at a time when it’s needed most,” Reed said.
He said Google also owns 60 percent of the market for “ad exchanges,” which run auctions for advertisers to get space on publishers’ websites. He added that 60 percent of all Gannett’s buyers come through Google, showing that Google controls and manipulates “every aspect of every online advertising transaction.”
Reed said this system hurts local news outlets that are struggling because of Google’s practices, and that newsroom employment has fallen by more than half since 2008. He said the lawsuit delves into more than a dozen Google practices that Gannett believes harm competition, and started in 2009 and continues to this day.
Dan Taylor, vice president of Google Ads, said in a statement that the allegations in the lawsuit are “simply false.” He said publishers have many options to choose from when using advertising technology, and Gannett uses dozens of competing ad services.
“And when publishers choose to use Google tools, they keep the vast majority of revenue. We will show the court how our ad products benefit publishers and help them monetize their content online,” Taylor said.
Google told The Hill that it has given billions of dollars to support journalism in the digital age and is one of the world’s largest financial backers of journalism.
It said publishers use multiple tools to sell ads on the platforms and Google’s ad technology fees are transparent and in line with industry standards.
Google has recently faced other legal challenges targeting its dominance in digital advertising. The Justice Department and eight states sued the company in January over its control of digital ad space, claiming it is an “industry behemoth” and has “corrupted legitimate competition in the ad technology industry by engaging in a systematic campaign to seize control of a wide variety of high-tech tools used by publishers, advertisers and brokers.”
The European Union also launched an antitrust investigation into Google in 2021 and raised new antitrust charges against the company last week. It said the company should sell parts of its digital advertising business to revive healthy competition.
The Gannett lawsuit seeks an unspecified amount in damages and an injunction against Google for further violations of the Sherman Antitrust Act, a federal law governing antitrust and monopoly regulation.
Gannett underwent several rounds of layoffs last year as part of cost-cutting measures amid a broader trend of several major news outlets undergoing layoffs.
The Associated Press contributed to this report.
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