Gannett CEO Pens Open Letter, Suing Google
Posted on 06/21/2023
Tech giant Google is facing lawsuits from both the government and private sector. Google has been accused of capturing publishers’ revenue for its own profits and punished publishers who sought out alternatives. With striking journalists and challenging finances for newspapers, Gannett CEO Mike Reed is facing headwinds. He has taken the step of suing Google after claiming that the tech giant owns 90% of the publisher ad services market, which newspapers rely on. Gannett’s USA Today published his open letter which states: “Our lawsuit seeks to restore fair competition in a digital advertising marketplace that Google has demolished.”
The letter goes on, “Today, 86% of Americans read the news online. As a result, news publishers depend on digital ad revenue to provide timely, cutting-edge reporting and content that communities across the country depend on. The move online should have created enormous opportunities for publishers. Digital advertising is now a $200 billion business – nearly an eightfold increase since 2009. Yet, news publishers’ advertising revenue has significantly declined. Google’s practices have real world implications that depress not only revenue, but also force the reduction and footprint of local news at a time when it’s needed most.”
Reed says Google is riding the wave of Gannett’s services: “The data reveals a fundamental mismatch in the online marketplace. Content providers, including hundreds of our local news outlets, create enormous value but see none of the financial upside because Google, as middleman, has monopolized the markets for important software and technology products that publishers and advertisers use to buy and sell ad space.”
Reed claims Google is anticompetitive in at least a dozen ways. Google has not commented on the suit.
Government Lawsuit
In January 2023, the U.S. Department of Justice (DOJ), along with the Attorneys General of California, Colorado, Connecticut, New Jersey, New York, Rhode Island, Tennessee, and Virginia, filed a civil antitrust suit against Google for monopolizing multiple digital advertising technology products in violation of Sections 1 and 2 of the Sherman Act. Filed in the U.S. District Court for the Eastern District of Virginia, the complaint alleges that Google monopolizes key digital advertising technologies, collectively referred to as the “ad tech stack,” that website publishers depend on to sell ads and that advertisers rely on to buy ads and reach potential customers. Website publishers use ad tech tools to generate advertising revenue that supports the creation and maintenance of a vibrant open web, providing the public with unprecedented access to ideas, artistic expression, information, goods, and services. Through this monopolization lawsuit, the Justice Department and state Attorneys General seek to restore competition in these important markets and obtain equitable and monetary relief on behalf of the American public.
Google’s parent company is Alphabet Inc.
