Google secretly gamed its own ad system, lawsuit claims

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Search giant accused of using that information to give itself an unfair advantage

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13 April 2021 | 0

Google has been using a secret programme to track bids on its digital ad-buying platform and it’s accused of using that information to give itself an unfair advantage over competitors, according to court documents filed in a Texas antitrust lawsuit.

Texas is one of a dozen states suing Google for antitrust practices in the search and advertising markets, and its lawsuit just inadvertently revealed some alleged behind-the-scenes information.

In the initial version of the filing, which The Wall Street Journal viewed, Google accidentally failed to redact some information, revealing its secretive business practices. A federal judge allowed Google to refile a redacted version later.

 

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In those documents, Google reportedly acknowledged the existence of an initiative called ‘Project Bernanke’, an apparent reference to former Federal Reserve chairman Ben Bernanke.

Texas alleges this programme was the equivalent of insider trading due to Google’s complicated role in the online advertising marketplace.

Texas says Google operates simultaneously as a major ad exchange operator, a representative of buyers and sellers on the exchange, and an ad buyer itself. By being both an owner and a client, Google gamed the system because it had access to exclusive data other ad buyers didn’t, according to the antitrust lawsuit.

Texas alleges that Google used information on what other ad buyers were willing to pay for space to bid just the bare minimum to beat rivals and secure ad placements, the state alleges. It could pay publishers less on its winning bids for ads.

In the court documents that Google filed, the search giant acknowledged “the details of Project Bernanke’s operations are not disclosed to publishers”. But it denied that the programme gave Google an unfair advantage, calling it “comparable to data maintained by other buying tools”.

Texas is one of a dozen states suing Google, accusing it of antitrust practices in the search and advertising markets. In October 2020, the US Dept of Justice and 11 states sued Google – California joined the lawsuit later.

The lawsuit says Google used exclusionary agreements to lock up the search engine market by requiring it to be the default search engine for mobile devices and computers.

In October, Google responded to the original lawsuit, calling its antitrust arguments “dubious” and arguing that its agreements are no different from those other companies have used to distribute software. It also said rival search services paid to be featured as prominent options on Apple’s Safari browser.

Dennis Publishing News Service


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