The country’s largest newspaper publisher by total circulation has sued Google over allegations the company is violating antitrust laws by controlling the tools used to buy and sell ads.
Gannett filed a lawsuit against Google and its parent Alphabet on Tuesday, arguing that the company controls how publishers sell their ad space and is forcing them to sell more and more ad space to Google at lower prices, resulting in lower revenue for the publishers and the Company leads competitors in advertising technology.
Mike Reed, CEO of Gannett, explained the reasons for the lawsuit in a USA Today editorial, saying ad revenue for news publishers has declined significantly because Google owns 90 percent of the market for “publisher ad servers,” through which publishers sell ad space online .
“Google’s practices have real-world implications that not only eat away at revenue, but cause local news to be scaled back and shared at a time when it’s most needed,” Reed said.
He said Google also owns 60 percent of the market for “ad exchanges,” which conduct auctions for advertisers to get space on publishers’ sites. He added that 60 percent of all Gannett buyers come through Google, showing that Google controls and manipulates “every side of every online advertising transaction.”
Reed said this system hurts local news outlets, which are struggling with Google’s practices, and that newsroom employment has fallen by more than half since 2008. He said the lawsuit concerns more than a dozen practices by Google that Gannett believes have affected competition since 2008-2009 and to date.
Dan Taylor, the vice president of Google Ads, said in a statement that the allegations in the lawsuit were “plainly false.” He said publishers have many options to choose from when using advertising technology, and Gannett uses dozens of competing advertising services.
“And when publishers choose to use Google tools, they keep most of the revenue. We will show the court how our advertising products benefit publishers and help them fund their content online,” Taylor said.
Google told The Hill that it has committed billions of dollars to support journalism in the digital age and is one of the world’s largest funders of journalism.
It says publishers use multiple tools to sell ads on the platforms and that Google’s advertising technology fees are transparent and in line with industry standards.
Google has recently faced other legal challenges aimed at its dominance in digital ads. The Justice Department and eight states sued the company in January over its control of digital advertising space, alleging that it was an “industry giant” and had “corrupted legitimate competition in the ad tech industry by conducting a systematic campaign to seize control.” conducted across the advertising spaces.” a wide range of high-tech tools used by publishers, advertisers and brokers.”
The European Union also launched an antitrust investigation into Google in 2021 and raised new antitrust allegations against the company last week. It said the company should sell parts of its digital advertising business to revive healthy competition.
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Gannett’s lawsuit seeks an unspecified amount of damages and an injunction against Google for further violations of the Sherman Antitrust Act, a federal law governing antitrust and monopoly regulations.
Gannett has faced several rounds of layoffs over the past year as part of cost-cutting measures, while several major news outlets have faced layoffs.
The Associated Press contributed to this report.
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