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US authorities sues Google for abuse of dominance in internet advertising

Google finds itself once more within the sights of the American authorities. The US Division of Justice and eight federated states (California, Colorado, Connecticut, New Jersey, New York, Rhode Island, Tennessee and Virginia) introduced Tuesday, January 24 to prosecute Google for abuse of a dominant place.

“The grievance filed right now alleges that Google engaged in exclusionary, anti-competitive and illegal practices so as to eradicate or considerably reduce any risk to its dominance in digital promoting applied sciences,” stated Legal professional Basic Merrick Garland. which had the impact “crowd out rivals, diminish competitors, inflate promoting prices, scale back revenues for information publishers and content material creators, stifle innovation and hurt the trade of knowledge and concepts within the public sphere”ensures the ministry.

Extra particularly, he lists in a press launch his numerous grievances in opposition to the American large: the acquisition of opponents, i.e. “key digital promoting instruments utilized by web site publishers to promote promoting house” ; compelled adoption of Google instruments; a distortion of competitors within the auctions of the promoting market; and the “manipulation of bidding mechanisms in a number of of its merchandise so as to isolate Google from competitors, scale back alternatives for rivals, and halt the rise of competing applied sciences.”

On internet advertising spending, Google threatened by Amazon

“We’re one in all lots of of corporations that allow the position of commercials on the Web. And it’s common data that the competitors is rising”, defended Dan Taylor, vp of promoting at Google. This one shouldn’t be totally incorrect: in accordance with the American website Axios, Google represented solely 28.8% of all digital promoting expenditure in the USA in 2021, in opposition to 34.7% in 2017.

If the development can be down for its competitor Meta, mother or father firm of Fb, WhatsApp and Instagram (19.6% market share in 2021 in opposition to 20% in 2017), it’s rising sharply for Amazon, which ought to maintain 12.7% of this market in 2024. Different corporations with excessive progress potential, resembling TikTok, Spotify or Apple, “are likely to focus solely on their particular platforms”, nonetheless, factors out the American specialised website Ars Technica, and subsequently don’t instantly threaten Google.

Dan Taylor attracts consideration to 2 particular requests from the US Division of Justice. “The DOJ [l’abréviation anglaise du ministère, ndlr] calls for that we reverse two acquisitions that have been reviewed by US regulators 12 years in the past (AdMeld) and 15 years in the past (DoubleClick). […] These transactions have been reviewed by regulators, together with the DOJ, and have been cleared.”he remembers.

In keeping with the US division’s grievance, Google’s providers are certainly in a monopoly place available on the market for digital promoting house, on the aspect of each sellers and consumers. Google’s “DoubleClick for Publishers” advert server, which permits websites to promote their house, has a market share of greater than 90%, whereas the Google Advertisements Community, aimed toward small companies trying to purchase that house, has an 80% market share; the “Show & Video 360” community, devoted to giant promoting businesses, has a market share of 40%. As for the Google Advert trade, which connects sellers and consumers, its personal market share is 50%.

The final dismantling of an organization in the USA dates again to… 1982

With this grievance, the DOJ seeks to hit Google within the pockets; within the final quarter of 2021, promoting accounted for 81% of the corporate’s complete income. Google has tried every little thing to keep away from such an antitrust lawsuit: final yr, the corporate had proposed to separate its promoting public sale exercise from its department devoted to digital promoting… whereas retaining the 2 beneath the fold of Alphabet, the home -mother. As early as 2020, the US Division of Justice sued Google for unlawful monopoly within the search and promoting markets; a grievance that Google challenged in court docket in early January.

In Europe, the corporate is beneath a brand new investigation opened in March 2022 by the European Fee, for anti-competitive practices on internet advertising shows. In the USA, society finds itself beneath the crossfire of each Democrats and Republicans: in Could 2022, a joint invoice on competitors and transparency in digital promoting was offered to the Senate.

It may power any firm coping with greater than $20 billion a yr in digital promoting transactions to divest a part of their enterprise within the sector, experiences the American website The Verge – which corresponds to Google or Meta. A risk which, as Ars Technica reminds us, stays purely digital for the second: “the final time a authorities dismantled an organization was 40 years in the past”, citing the case of the telecommunications firm Bell Techniques, cut up in 1982 into AT&T, Verizon and Lumen Applied sciences.

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