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Antitrust documents detail an alleged conspiracy between Facebook and Google


Image of the article titled Google & # 39;  s Pichai, Meta'  Zuckerberg's Backed by an Alleged Advertising Price Stabilization Scheme, Unsealed Claim from Court Documents

Photo: Denise Sharlet (Getty Images)

When Texas Attorney General Ken Paxton Initially The multi-state antitrust case against Google at the end of 2020, contained some (heavily redacted) allegations of a confidentiality agreement with Facebook that would allow the duo to crush fellow competitors in the ad space and control the lion’s share of digital ad spending for today. Now, some details about this deal are finally open to the public: New court filings From a lawsuit disclosed on Friday it alleges that the deal, dubbed “Jedi Blue,” gave Facebook an illegal role in Google’s ad auctions in exchange for Facebook’s word that it would back down on its advertising plans. Furthermore, it claims that senior executives of both companies signed off on the deal.

The technology used to display ads online is a Byzantine technology in a way that can leave People in online advertising industry They scratch their heads, which means that the more than 240 pages in the latter part of the Texas case can be difficult to explain succinctly. In short, publishers across the web – news sites, recipe blogs, whatever else you can name it – usually rely on what’s called an “ad exchange” to pawn their ad space available to advertisers across the web. Google’s ad exchange has always been one of the biggest ever, leaving websites with no choice but to work with the company if they want to get any kind of decent advertising revenue.

All this changed in 2017 with the invention of a new type of technology calledvertical bidding“Websites would allow Bypass the Google exchange and continue to make good money from their ad space. Facebook social networking site Announce quickly It will make itself compatible with major bids soon after, which means publishers can take advantage of Facebook’s offerings Many, Much much more) Advertisers in exchange for handing over a small portion of their advertising dollars to the company. More advertising dollars in Facebook’s pocket means less Google money, which the case claims has left the latter scrambling to find a way to defuse this competitive threat.

The deal the two allegedly struck was “Jedi Blue”. In it, Facebook agreed to scale back its participation in vertical bidding in exchange for “information, speed, and other benefits.”“You will get it using Google Ads auctions. One of the biggest advantages described in the case was purported Advance share on the number of ad auctions Facebook will win over other competitors using Google Ad Exchange.

While their names have been redacted in the documents, the lawsuit claims that Facebook (now Meta) CEO and COO – Mark Zuckerberg and Sheryl Sandberg, respectively—The deal was signed in 2018, as did Sundar Pichai, CEO of Google. Today, both of their companies dominate More than half Approximately 491 billion dollars digital advertising market.

The two companies separately denied their involvement in the alleged scheme Statements by PoliticoBoth claim that their advertising technology is designed to help advertisers and publishers, rather than stuffing their own pockets. “Despite Attorney General Paxton’s three attempts to rewrite his complaint, it remains riddled with inaccurate information and lacks legal merit,” Google spokesman Peter Schottenfels said. “There is strong competition in online advertising, which has led to lower advertising technology fees, expanding choices for publishers and advertisers.”

Facebook — which has since been renamed Meta — echoed the sentiment. “Meta’s non-exclusive bidding agreement with Google and similar agreements we have with other bidding platforms have helped increase competition for ad placements,” said Christopher Sgro, a Meta spokesperson. “These working relationships allow Meta to deliver more value to advertisers while compensating publishers fairly, resulting in better outcomes for everyone.”



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