(AP Photo/Marcio Jose Sanchez, File)
Texas AG says the tech giant eliminates its competition and “crowned itself the king of online advertising.”
Texas filed a lawsuit against Alphabet Inc, owner of Google, backed by nine other states on Wednesday with the accusation of it breaking antitrust law on how it runs online advertising business.
It is the second major complaint coming from regulators against Google and the fourth in the series of state and federal lawsuits that aim to reign in supposed bad behavior by the large tech companies which has grown quite significantly in the past decades, it was filed in the Eastern District of Texas.
The U.S. Justice Department’s lawsuit against the company in October was joined by the Texas Attorney General Ken Paxton, who accused the $1 trillion tech conglomerate with using its power to monopolize the market illegally, the coalition had 10 states in it when the lawsuit was filed.
Google dominates and monopolizes the process of obtaining an advertisement from an agency that produces it to a web page or mobile app which helps attract potential customers, Texas argues in its lawsuit.
“Google repeatedly used its monopolistic power to control pricing (and) engage in market collusions to rig auctions in a tremendous violation of justice,” Paxton states in a Facebook video.
The tech giant “eliminated its competition and crowned itself the king of online advertising,” he continues.
“We will strongly defend ourselves from his baseless claims in court,” a Google spokeswoman retorted, responding to Paxton. “Digital ad prices have fallen over the last decade. Ad tech fees are falling too. Google’s ad tech fees are lower than the industry average. These are the hallmarks of a highly competitive industry.”
Texas was joined by Indiana, Kentucky, Utah, North Dakota, Mississippi, Arkansas, Missouri, Idaho, and South Dakota.
The delay in the publication of the complaint was due to it not being available immediately for download. Over 80% of Alphabet’s revenue is due to Google ad sales, however, most of the sales of Alphabet’s profits stem from Google’s high-margin operation of placing text ads above search results.