Lawsuits claim Facebook and Google executives were aware of agreements to control ad sales | Technology
Facebook CEO Mark Zuckerberg and Google CEO Sundar Pichai were reportedly aware of and approved an agreement to collaborate on potential manipulation of advertising sales, according to recently revealed documents.
The documents, which emerged on Friday, were filed as part of a lawsuit against Google filed by the Attorney General in several US states. The lawsuit was first filed in December 2020, alleging that Google misled publishers and advertisers about the price and process of ad auctions. At that time, many documents and parts of the lawsuit were edited, but court decisions have since published them.
The lawsuit alleges that Google maintained control of the advertising sales market – a market in which it dominates – by raising the prices of brand advertising and suppressing competition from other advertising exchanges.
According to the Wall Street Journal, the complaint claims that “Google pocketed the difference between what it told publishers and advertisers that an ad cost and used the money pool to manipulate future auctions to expand its digital monopoly.” The documents further cite internal messages in which Google employees said it was as if they were using “inside information” to grow the business.
The Journal reported that the lawsuit also claims managers at both Facebook, which was recently renamed Meta, and Google signed an agreement to allegedly assure that Facebook would bid, and win, a certain percentage of the ads.
According to the lawsuit, Facebook’s CEO, Sheryl Sandberg, was “explicit that ‘this is a big deal strategically'” in a 2018 email thread about the deal that included Facebook’s CEO.
When the two sides struck out the terms of the agreement, “the team sent an email addressed directly to CEO” Zuckerberg, the lawsuit states.
If Pichai has personally approved the deal, he may be found to be complicit in the expansion of Google’s monopoly on the advertising market through manipulation. A Google spokesman told the Associated Press that although the agreement was not a secret, it was inaccurate to say that Pichai approved it.
“We sign hundreds of agreements every year that do not require the approval of the CEO, and this was no different,” the spokesman said.
In a statement, Google spokesman Peter Schottenfels said the lawsuit was “full of inaccuracies and lacks legal merit”.
Meta spokesman Chris Sgro said on Friday that the company’s ad bidding agreement with Google and similar agreements it has with other bidding platforms “has helped increase competition for ad placements”.
“These business relationships enable Meta to deliver more value to advertisers while compensating publishers reasonably, resulting in better results for everyone,” said Sgro.
The new details come as technology companies face increasing scrutiny of alleged anti-competitive practices. A US judge ruled earlier this week that the government could pursue a lawsuit seeking to break up Meta, the parents of Facebook, Instagram and WhatsApp, in an attempt to loosen its grip on the market. And on Friday, a group of nearly four dozen states asked to reintroduce a separate antitrust lawsuit against the company.
Google, meanwhile, is facing its own monopoly-related allegations raised by the US government. Google has denied the allegations.
