Google Mandated by the Court to Confront a £13.6 Billion Lawsuit Concerning Advertising
A court ruling mandates Google to confront a £13.6 billion lawsuit, alleging its dominance in the online advertising market. The case, initiated by Ad Tech Collective Action LLP, accuses the tech giant of anti-competitive practices, resulting in financial losses for UK online publishers.
Alphabet, Google’s parent company, attempted to dismiss the case, labeling it “incoherent.” However, the Competition Appeal Tribunal in London has decided to proceed with the trial.
“This ruling marks a significant milestone for those affected by Google’s anti-competitive behavior in adtech,” stated Claudio Pollack, former Ofcom director and current partner at Ad Tech Collective Action. “Google will now be held accountable for its actions in a comprehensive trial.”
However, Google’s legal director, Oliver Bethell, dismissed the lawsuit as “speculative and opportunistic.” “We will vigorously oppose it based on factual grounds,” he emphasized in a statement.
The case revolves around advertising technology, commonly referred to as adtech, which determines the online advertisements users encounter and their cost to publishers. Hosting such advertisements constitutes a substantial revenue stream for numerous websites – with digital advertising expenditure reaching $490 billion in 2021, according to Ad Tech Collective Action.
Google’s dominance in web search makes this industry exceptionally valuable for the tech giant. Central to the claim is the assertion that Google is exploiting this dominance to diminish websites’ revenue streams.
Ad Tech Collective Action asserts that Google has practiced “self-preferencing,” prioritizing its own products and services over those of its competitors. This practice, according to the group, results in publishers receiving reduced compensation for the ads they host and being subjected to “very high” fees imposed by Google.
“I am eager to collaborate with our legal and economic advisors to secure compensation for the years when the relevant markets failed to produce a competitive outcome for the UK publishing market,” stated Mr. Pollack.
Resolution of this case is expected to be protracted; eighteen months have already passed to reach this stage, with no court date scheduled yet. The case operates on an opt-out basis, meaning all pertinent UK publishers are automatically involved unless they choose otherwise. Funding is provided by an undisclosed third party, and participating UK publishers will not be responsible for associated costs.
This legal action unfolds amidst ongoing regulatory investigations into Google’s adtech operations by authorities in the UK, Europe, and the US. Additionally, Google has already incurred substantial fines from the European Commission for what it deems anticompetitive behavior.