Charles Arthur, a former technology editor at The Guardian, is suing Google for £3.4bn ($4.2bn) in damages related to the loss of income for publishers. He is claiming that Google’s actions have caused these losses and must be held accountable. This is the second complaint filed against Google, after Claudio Pollack, former Ofcom director took legal action against them in November 2021.
Advertising Technology at the Heart of the Lawsuit
Multiple lawsuits have recently emerged in the realm of advertising technology, commonly referred to as ‘adtech’. This tech is responsible for quickly determining which ads viewers are exposed to, what the cost will be and how much revenue is earned by publishers. According to allegations, Google leveraged its strong position in the online advertising market to limit how much publishers could earn from display ads. This has become a major source of income for various websites & impacted their revenue significantly.
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Google Denies Allegations
Google has characterized the lawsuit as being “speculative and opportunistic,” and vowed to defend itself against it with vigor. The tech giant has declared that millions of websites and apps have been funded and helped to get noticed by potential customers through its own advertising tools or other adtech industry resources. This has enabled companies, regardless of their size, to engage new customers & advertise successfully. The company acknowledges the presence of other competitors in the market and points out that their advertisement-related fees are on par with, or lower than, industry standards.
CMA Investigation
At present, the UK’s Competition and Markets Authority (CMA) are conducting an investigation into Google’s overwhelming presence in the realm of ad technology. The Competition and Markets Authority (CMA) is currently investigating the alleged anti-competitive conduct of Google in the field of adtech. Arthur and Pollack have also filed lawsuits to compensate those who faced losses as a result.
Opt-Out Collective Claims
English law has recently recognised the concept of collective claims, otherwise known as class actions, in 2015. These are legal proceedings brought by a group of people for the same type of infringement or injury. The claimants have asked the court, the Competition Appeal Tribunal, to authorize their claims for ‘opt-out’, where every relevant publisher is included in the case unless they decide not to. Representing an entire class or group, this could potentially result in vast damages which makes it a unique situation.
Google’s Competitors
Despite Google’s claims of competition, the CMA found that the search engine giant dominated the adtech market with its largest supplier in three crucial areas. In early 2022, the DOJ took legal action against Google for unfairly monopolizing the market for digital advertising. It alleged that Google had utilized anti-competitive tactics to control the majority of high-tech tools used by publishers, thus corrupting competition in the adtech world.
French Competition Regulator Fines Google
At the start of 2021, Google was fined a staggering €220m by the French regulator Autorité de la concurrence for promoting its own services on online ads. This penalty is an indication of how seriously such anticompetitive behaviour is taken.
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In Summary, Unless Arthur and Pollack can come to an agreement, the tribunal will have to make a final decision as to who should head the group’s claim. We are observing a massive pushback against Google’s domination of the online advertising market. The legal proceedings and CMA inquiry into these issues could have significant implications for every player in this field and reshape the future of digital advertisement.
