Google refutes the claim that Google had a fraudulent advertising contract that favors Facebook

Google is suspected of violating the antitrust law (antitrust law) because it has taken anticompetitive actions to interfere with rivals and monopolized the market. As one of the points of contention, it has been pointed out that Google and Facebook conspired to maintain a monopoly in the advertising market, but Google argued that the series of information was ``inaccurate depiction.'' has been published.

Behind a Secret Deal Between Google and Facebook - The New York Times

AG Paxton's misleading attack on our ad tech business

In October 2020, Google was sued by Texas Attorney General Ken Paxton and others for ``illegally maintaining a monopoly through anti-competitive and exclusive practices in the search and search advertising markets.'' .

Google is sued by the Justice Department for ``antitrust violations''-GIGAZINE

In addition to the above, in December, Google was also sued for antitrust violations in that it conspired with Facebook to enter into an anti-competitive agreement.

Google faces further antitrust lawsuits, now suspected of collusion with Facebook - GIGAZINE

In the announcement, Attorney General Paxton accused ``Google's anti-competitive behavior has increased advertiser costs and reduced the quality of advertising services.'' In response, Google said, ``Not only are Google's advertising fees below the industry average, but online advertising prices and fees in the industry have also declined over the past decade, which is characteristic of an industry with intense competition.'' I objected.

Regarding this trial, the New York Times newly said that ``Facebook was planning to compete with Google in advertising sales, but withdrew from competition after signing a contract to prioritize Facebook in Google's advertising system.'' Document details are reported.

In recent years, Internet advertising has not taken the form of “advertisers who want to place advertisements directly deal with the media side for advertising space”, but rather, advertisements on a system that integrates ad networks and ad exchanges that have multiple media. Based on the cost and audience, the main adopts the form of `` bidding down the advertising space in an auction format ''. These deals are also called programmatic advertising because they happen almost automatically.

Since Google dominates advertising on the Internet, a method called 'header bidding' became popular until around 2016 in order to reduce reliance on Google's advertising platform and increase competition. rice field. Header bidding allows bids to be solicited from multiple exchanges, including Google, at once, so it is believed that competition will become more intense and advertising prices will be optimized. By 2016, 70% of media outlets are said to have adopted header bidding.

However, increased competition means greater losses for Google. For this reason, Google has developed a method called '

Open Bidding ' to support affiliated exchanges. Exchanges that are not affiliated with Google in Open Bidding will compete with Google, and the fee will be collected for each successful bid.

Meanwhile, Facebook announced in 2017 that it was testing header bidding. Facebook becoming a rival to Google in header bidding was a big threat to Google. For the advertising industry, Facebook's entry into header bidding has become a hot topic as it has the potential to reverse the industry's tendency to lean towards Google's Open Bidding.

But in December 2018, Facebook abruptly announced that it would no longer participate in header bidding and would join Google's Open Bidding. Although it was not disclosed in Facebook's announcement, according to the plaintiff's draft of the lawsuit, at this time, Google asked Facebook to provide 'special information' and 'guarantees of a certain closing rate' and 'to win the auction, etc. He promised to provide 'special bidding speed' that is not offered to its partners. For example, in Open Bidding, price information is not disclosed to the media until the final bid amount received by the media is decided, but Facebook has provided such price information. The court documents also stated that Facebook would bid on at least 90% of the identified end-users to whom the ads were shown, and that by year four of the deal, it would spend $500 million annually on Open Bidding. claims to have promised to pay

On the other hand, in response to the series of reports, Google's economic policy director Adam Cohen argued that 'the information is inaccurate.' Facebook Audience Network (FAN)'s participation in Open Bidding is public information, and Open Bidding is a 'very small part' of Google's advertising business, less than 4% of all display advertising. Google explained that it is nothing more than And in response to Attorney General Paxton's allegation that ``Google is manipulating the Open Bidding auction in favor of FAN,'' Google said, ``We have never done so. We have also participated in several similar auctions.'

in Web Service, Posted by darkhorse_log