Gannett Co Inc, the largest newspaper chain in the United States, has filed a lawsuit against Google, alleging that the tech giant has violated federal antitrust laws in its attempts to monopolize the online advertising market.
In the complaint filed in federal court in Manhattan, Gannett, the publisher of USA Today and over 200 daily newspapers, claims that Google and its parent company, Alphabet Inc, dominate the tools used for buying and selling online ads.
This alleged dominance forces several publishers to sell online advertising space to Google at low prices, resulting in significantly reduced revenue for publishers and Google’s ad-tech rivals, while Google enjoys enormous profits from its monopoly.
Google has not yet responded to the requests for comment regarding the lawsuit, Reuters news report said.
Gannett is seeking unspecified damages through this legal action. The company filed the lawsuit five months after the U.S. Department of Justice filed a similar lawsuit against Google for its advertising technology. Additionally, on June 14, the European Union also filed its own case, suggesting that Google may be required to sell some of its advertising technology.
In 2022, Google generated $224.5 billion in advertising revenue, accounting for nearly 80 percent of Alphabet’s overall revenue, and recorded a total profit of $60 billion. The revenue from advertising enables Google to provide many of its services for free, such as email and a significant portion of its YouTube video platform. In the first quarter of the current year, Google’s ad revenue remained relatively stable at $54.5 billion compared to the previous year.
Gannett, based in McLean, Virginia, has encountered challenges in recent years due to declining ad revenue and the shift of news consumption to online platforms. The company states that its newspapers’ print circulation decreased by almost 20 percent in both 2020 and 2021. Since its merger with GateHouse Media in 2019, Gannett has closed down more than 170 publications.
The lawsuit highlights the significant growth of the online digital advertising industry in the United States, which has expanded nearly eightfold since 2009, becoming a $200 billion business. In contrast, newspaper ad revenue has plummeted by almost 70 percent during the same period.
The case is titled Gannett Co v Google LLC et al and is being heard in the U.S. District Court for the Southern District of New York, with the case number 23-05177.