Google awaits service in three countries over digital ad conduct.
One of the first victims of the rapid tectonic shift in how the world consumes information was the publishing industry, particularly news organizations whose readership and advertising revenues went off a cliff when digitization, aggregation and click-models put much of the market up for grabs.
U.S. publishers’ ad revenue prior to 2010 was about $50 billion. According to the Pew Research Center, that figure had cratered to less than $10 billion by 2020. The worldwide digital advertising spend, meanwhile, was more than $520 billion in 2021 and is expected to exceed $875 billion by 2026, according to data gathered by Statista.
There is no question that digitization has revolutionized news publishing and reader expectations in many positive ways. Much of the functionality and greater access is extraordinary – providing much more than people could expect from neatly folded broadsheets tossed onto their porches and driveways. Real-time data-driven consumer insights was a spectacular boon for advertisers. Publishers eventually caught on, although for too many it was too late and many languish today right along with journalists’ pay.
But, publishers say, it was more than just features and functionality that dominant players like Google brought to the equation – it was also illegal anticompetitive behavior.
The Antitrust Division of the Department of Justice, according to Bloomberg, is preparing an antitrust suit against Google claiming the same thing. If the report is correct the DOJ’s suit could drop at any moment in federal court either in Washington, DC or New York. This would be the second suit brought against the tech giant by the DOJ, joining the Antitrust Division’s case relating to Google’s search dominance.
European publishers have faced the same decline in revenues as their American counterparts. Deciding to no longer tolerate what they view as an unfair playing field, groups of publishers are preparing to sue Google in the UK and the Netherlands for as much as $25 billion for the company’s alleged anticompetitive advertising technology practices, according to the law firm bringing the actions. This opens another front against Google on the continent. Google was recently fined more than $220 million by French regulators, and investigations continue by the European Commission and the UK Competition and Markets Authority.
September could be the beginning of even more legal activity for already active legal departments at Alphabet and Google on two continents.
Edited by Tom Hagy for MoginRubin LLP.