Texas Attorney General Ken Paxton has joined attorneys general from eight other states to file a lawsuit against Google for digital ad practices they claim are abusive and monopolistic.
Paxton’s Texas suit has been joined by Arkansas, Indiana, Idaho, Kentucky, Missouri, Mississippi, North Dakota, South Dakota, and Utah.
Google has denied the allegations.
Paxton said in a video shared on Twitter, “Google repeatedly used its monopolistic power to control pricing, engage in market collusions to rig auctions, and a tremendous violation of justice.”
“Right now, when you visit the website of a news outlet you know and trust… You’ll see advertisements likely placed there by Google,” Paxton continued.
The Texas AG then accused Google of manipulating ads.
“But Google doesn’t tell you, the public, that they manipulate the advertising auction, and they continually, illegally profit, by taking money away from those web pages and putting it in their own pockets,” he claimed.
“This goliath of a company is using its power to manipulate the market, destroy competition, and harm you, the consumer,” Paxton insisted.
Paxton effectively said the tech giant was creating an abusive monopoly.
“These actions harm every person in America,” Paxton said. “It isn’t fair that Google can harm the web pages you visit and read, and it isn’t fair that Google effectively eliminated its competition and crowned itself the head of online advertising.”
AG Paxton used a baseball analogy to explain what he thinks is happening at the tech giant.
“If the free market were a baseball game, Google positioned itself as the pitcher, the batter, and the umpire.” Paxton said.
According to tech website The Verge, Google has denied the claims made by Paxton and the other states in the anti-trust lawsuit.
Reached for comment, Google denied the claim that digital ad markets are suffering from consolidation, citing recent declines in prices and fees. “Attorney General Paxton’s ad tech claims are meritless, yet he’s gone ahead in spite of all the facts,” a company representative said. “Digital ad prices have fallen over the last decade. Ad tech fees are falling too. Google’s ad tech fees are lower than the industry average. These are the hallmarks of a highly competitive industry.
ABC News reports that ad sales make up the huge majority of Google’s revenue:
The complaint targets the heart of Google’s business — the digital ads that generate nearly all of its revenue, as well as all the money that its corporate parent, Alphabet Inc., depends upon to help finance a range of far-flung technology projects.
As more marketers have increased their spending online, those digital ads have turned Google into a moneymaking machine. Through the first nine months of this year, Google’s ad sales totaled nearly $101 billion, accounting for 86% of its total revenue.
ABC also interestingly notes that 50 states had joined Texas in investigating Google’s practices.
Yet, the current lawsuit only encompasses Republican attorneys general.
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