2 April: Google is facing a new legal challenge from UK publishers who are seeking $4.2 billion in compensation for lost revenue due to the tech giant’s alleged anti-competitive practices in online advertising.
The lawsuit was filed by Charles Arthur, a former technology editor of The Guardian, who claims that Google inflated the prices of ad-tech services and unlawfully reduced the ad sales revenues of publishers. Google has denied the allegations and said it would fight the “speculative and opportunistic” action vigorously.
This is the second lawsuit of its kind, following a similar one launched in November last year by Claudio Pollack, a former director of UK’s communications regulator Ofcom, who is looking for up to $16.8 billion in damages from Google. Both lawsuits are collective claims, meaning that every relevant publisher would be automatically included in the case unless they opt out.
The lawsuits are based on the findings of the UK Competition and Markets Authority (CMA), which is currently investigating Google’s dominance in advertising technology. The CMA has estimated that Google controls more than 90% of the market for some key ad-tech services and has raised concerns about its potential to harm competition and consumers.
Online advertising is the main source of income for many websites and apps. Google’s ad-tech services decide in a fraction of a second which online ads consumers will see, how much they will cost, and how much publishers will earn. Arthur argues that because of Google’s abuse of its position, publishers have been deprived of a fair share of the online advertising market.
“The CMA is currently investigating Google’s anti-competitive conduct in ad-tech, but they don’t have the power to make Google compensate those who have lost out. We can only right that wrong through the courts, which is why I am bringing this claim,” Arthur said.
Google is also facing similar lawsuits in other countries, including the US, where it has been accused of being an “industry behemoth” that has “corrupted legitimate competition” in the ad-tech industry by engaging in a “systematic campaign” to seize control of the market.
Google has asked a court to dismiss the case, arguing that it has many competitors and that its ad-tech fees are lower than or match industry averages.