Lawsuit claims Facebook and Google CEOs were aware of deal to control advertising sales | Technology

Facebook CEO Mark Zuckerberg and Google CEO Sundar Pichai reportedly knew about and approved a deal to collaborate on potential manipulation of ad sales, according to newly disclosed documents.

The documents, which came to light on Friday, were filed as part of a lawsuit against Google brought by the attorneys general of several US states. The lawsuit was first filed in December 2020 and claimed that Google misled Google. publishers and advertisers about the price and process of ad auctions. At that time, many documents and parts of the lawsuit were drafted, but court rulings have since made them public.

The lawsuit alleges that Google maintained control over the ad sales market, a market it dominates, by inflating the price of branded ads and suppressing competition from other ad exchanges.

According to the Wall Street Journal, the complaint alleges that “Google kept the difference between what it told publishers and advertisers an ad cost and used the pool of money to rig future auctions to expand its digital monopoly.” The documents also cite internal messages in which Google employees said it was as if they were using “insider information” to grow the business.

The Journal reported that the lawsuit also claims that executives at Facebook, which recently renamed itself Meta, and Google entered into an agreement to allegedly ensure that Facebook would bid and win a certain percentage of ads.

According to the lawsuit, Facebook COO Sheryl Sandberg was “explicit that ‘this is a big deal strategically'” in a 2018 email thread about the deal that included Facebook’s CEO.

When the two sides agreed to the terms of the deal, “the team sent an email addressed directly to CEO” Zuckerberg, according to the lawsuit.

If Pichai is found to have personally approved the deal, he may be found complicit in expanding Google’s monopoly over the ad market through manipulation. A Google spokesman told the AP that while the deal was not a secret, it was incorrect to say that Pichai approved of it.

“Every year we sign hundreds of deals that don’t require CEO approval, and this was no different,” the spokesperson said.

In a statement, Google spokesman Peter Schottenfels said the lawsuit is “riddled with inaccuracies and lacks legal merit.”

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

“These business relationships allow Meta to deliver more value to advertisers while fairly compensating publishers, leading to better results for everyone,” said Sgro.

The new details come as tech companies face increasing scrutiny for allegedly anti-competitive practices. A US judge ruled earlier this week that the government can proceed with a lawsuit seeking to break up Meta, the parent company of Facebook, Instagram and WhatsApp, in an effort to loosen its grip on the market. And on Friday, a group of nearly four dozen states asked to reinstate a separate antitrust lawsuit against the company.

Meanwhile, Google is facing its own monopoly-related charges brought by the US government. Google has denied the charges.

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