Google faces £22billion lawsuit from publishers in Europe which accuse search engine of using anti-competitive methods to deprive them of billions in revenue
- Lawyers are seeking up to £22billion [$25 billion] in damages from publishers across Europe
- They say Google deprived media of revenue through ‘anti-competitive conduct’
- US tech giant is claimed to have favored its own services in online advertising
- This allegedly made it more difficult for rival advertising services to compete
A huge ‘ad tech’ class action legal case has been brought against Google over its technology powering online adverts which consumers view on news media.
Lawyers seeking up to £22billion [$25 billion] in damages from publishers across Europe claim the US tech firm deprived the media of revenue through its ‘anti-competitive conduct’.
The California-based company is alleged to have favored its own services in online advertising, making it more difficult for rival advertising services to compete.
This relates to complex algorithmic auctions that power Google’s online display advertising business, which are claimed to have seen it favor its own ad exchange.
The French Competition Authority fined Google £190million [$222 million] in June last year over its ad tech practices after it was found to have abused its dominant position.
A sign next to Google’s headquarters at Mountain View in California is pictured (file image)
Now, a claim is being brought in the UK Competition Appeal Tribunal which lawyers said will focus on recovering lost revenue from the sale of advertising space.
The action in Britain is being brought by competition law firm Geradin Partners, which is working with litigation law firm Humphries Kerstetter.
There is also a collective claim representing publishers in the European Union which is being brought by Geradin Partners in conjunction with Dutch law firm Stek.
Toby Starr, partner at Humphries Kerstetter, said today: ‘This important claim will represent a class of victims of Google’s anti-competitive conduct in ad tech who have collectively lost an estimated £7billion [$8 billion].
‘This includes news websites up and down the country with large daily readerships as well as the thousands of small business owners who depend on advertising revenue – be it from their fishing website, food blog, football fanzine or other online content they have spent time creating and publishing.’
Speaking about the EU action, which is being launched in the Netherlands, Jan Bart van de Hel from Stek said: ‘Many publishers have suffered damages as result of Google’s wrongful actions.
‘It is important to take action against this, not only to make sure that the damages of the publishers are fully compensated, but also to make sure that Google’s anticompetitive conduct is prevented for the future.’
Since the French case, the European Commission and the UK’s Competition and Markets Authority (CMA) have both begun investigating Google’s conduct in ad tech.
Damien Geradin from Geradin Partners said: ‘Publishers, including local and national news media who play a vital role in our society, have long been harmed by Google’s anticompetitive conduct.
‘It is time that Google owns up to its responsibilities and pays back the damages it has caused to this important industry. That is why today we are announcing these actions across two jurisdictions to obtain compensation for EU and UK publishers.’
In the UK, the CMA said in May that its probe would focus on advertising technology intermediation, also known as the ‘ad tech stack.’
This is a set of services which facilitate the sale of online advertising space between sellers and buyers, and is said to be worth £1.8billion [$2.1 billion] a year based on 2019 data.
The CMA said Google has a strong position at various levels of this space – providing a wide range of services including platforms where advertisers can buy online advertising space; technology that automates the sale of advertising space; and those for managing ad inventories for publishers, which decide which ads to show.
Governments around the world are strengthening the regulation of US tech giants that have become even more powerful during the pandemic.
Britain launched a new competition regime last year to prevent Google and Facebook using their dominance to push out smaller firms and disadvantage customers.
The move created a dedicated Digital Markets Unit within the CMA which will be given powers to suspend, block and reverse decisions made by technology firms.
It can also impose financial penalties for non-compliance, with companies told they need to be more transparent about how they use consumer data.