New lawsuit alleges Facebook and Google colluded in online ad sales

WION Web Team
California, United States Updated: Jan 16, 2022, 05:22 PM(IST)

In this combination of images, Alphabet CEO Sundar Pichai can be seen along with Facebook CEO Mark Zuckerberg Photograph:( AFP )

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The deal was allegedly struck as part of Google's effort to counter header bidding, which publishers wanted to use to make more money from advertising placed on their websites

A new lawsuit has claimed that Facebook CEO Mark Zuckerberg and Google CEO Sundar Pichai colluded in online ad sales.

According to an amended antitrust complaint filed by Texas and 15 other states, the two tech giants teamed up and hammered out the terms of the agreement.

The deal was allegedly struck as part of Google's effort to counter header bidding, which publishers wanted to use to make more money from advertising placed on their websites, the filing said.

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"Google quickly realised that this innovation substantially threatened its exchange’s ability to demand a very large 19 to 22 per cent, cut on all advertising transactions," the filing said.

"Following the agreement, Facebook curtailed its involvement with header bidding in return for Google giving Facebook information, speed, and other advantages."

Facebook, which has since become Meta Platforms Inc, said in a statement that the deal was not exclusive to Google and that other agreements have increased competition for ad placements. It said it was better for advertisers "while fairly compensating publishers."

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Facebook’s former chief operating officer Sheryl Sandberg was “explicit that ‘this is a big deal strategically’” in a 2018 email thread about the deal that included Zuckerberg.

“We’re nearly ready to sign and need your approval to move forward,” the email read, according to the complaint. Zuckerberg wanted to meet with Sandberg and his other executives before making a decision, the complaint states.

In a statement, Google spokesperson Peter Schottenfels said the lawsuit is “full of inaccuracies and lacks legal merit.”

Meta spokesperson Chris Sgro said Friday that the company’s ad bidding agreement with Google and similar agreements it has with other bidding platforms “have helped to increase competition for ad placements.”

“These business relationships enable Meta to deliver more value to advertisers while fairly compensating publishers, resulting in better outcomes for all,” Sgro said.

(With inputs from agencies)

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