Alphabet Inc subsidiary Google said on Wednesday it considers a US Justice Department complaint alleging it is abusing its dominance in digital advertising “without merit”. The company also said it would “vigorously defend itself”.
The government advocated coercion Google on Tuesday to sell its Ads Manager suite, focusing on a division that contributed significantly to the search engine and cloud company’s total sales and brought in about 12% of Google’s revenue in 2021.
According to Google, which relies on its advertising business for about 80% of its revenue, “the government is doubling down on a flawed argument that will slow innovation, raise advertising fees and make it harder for thousands of small businesses and publishers to grow.” “.
The federal government has said its Big Tech probe and lawsuits aim to level the playing field for smaller competitors. Who? are up against a slew of formidable businesses that include Apple Inc., Amazon. Com, and Meta Platforms, are owned by Facebook.
Wells Fargo analyst Brian Fitzgerald said, “Unlike previous cases/investigations against Google’s ad tech biz, we view the DOJ complaint as quite substantive and undoing some potential Google lines of defense.”
On Tuesday, the Justice Department and eight states filed an antitrust lawsuit against Google, claiming that its alleged monopoly over the entire online advertising ecosystem was a burden on advertisers, consumers and even the US government.
In its complaint, the government claimed that Google was trying to “neutralize or eliminate” rivals in the online advertising market through the acquisition and was doing so by making it difficult for advertisers to use rival products.
It is part of a new, if slow and stalled, US effort to rein in the big tech firms that have been largely deregulated over the past 15 years.
(with inputs from agencies)
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