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Everything You Need to Know About the Google Antitrust Lawsuit

Last week, the US Department of Justice filed an antitrust lawsuit against Google. Joined by eight state attorneys general, the federal government said the tech giant is running an illegal monopoly in the digital ad market, and it wants the courts to compel Google to sell its subsidiary ad businesses, breaking the company into several less hazardous pieces.

The text of the lawsuit is a sprawling 149-page complaint, complete with charts, graphs, exhaustive information, and fun new key terms for the kids to learn like “header bidding” and “enhanced dynamic allocation.” You’ve probably cleared your schedule to make time to sink your teeth into every word of juicy legalese, but thanks to this article, you don’t have to.

Here’s a simple way to think about what the Justice Department is accusing Google of doing: “It’s like you’re buying a house from a realtor who’s also representing the seller,” said Joel Cox, co-founder of Strategus, an ad tech company. “It would be pretty hard to measure whether both parties are going to leave the transaction satisfied, but you can bet the realtor is going to get their piece.”

According to the Justice Department, Google abuses its extremely advantageous market position of owning the ad space, the auction apparatus, and the tech that matches buyers with sellers. The company has access to information about every part of the countless ad transactions that happen every minute, which allegedly gives Google a huge advantage over its competitors.

According to the complaint, Google competes with the publishers who sell ad space and manipulates ad sales in its favor. The company privileges the ad space on its own properties, routing the most profitable ads to places like Search and YouTube (allegedly). On the other end of the transaction, Google knows exactly what prices sellers will let their ad space go for, so it can offer ad buyers a lower price to ensure ads get routed through its system (allegedly). That gives Google three bites of the advertising apple: one from the buyers, one from sellers, and one for handling the sale (allegedly).

To read the full article by Gizmodo, click here

Posted by Strategus