HackedGoogle and Facebook execs allegedly approved dividing ad market...

Google and Facebook execs allegedly approved dividing ad market among themselves


- Advertisment -

The alleged 2017 deal between Google and Facebook to kill header bidding, a way for multiple ad exchanges to compete fairly in automated ad auctions, was negotiated by Facebook COO Sheryl Sandberg, and endorsed by both Facebook CEO Mark Zuckerberg (now with Meta) and Google CEO Sundar Pichai, according to an updated complaint filed in the Texas-led antitrust lawsuit against Google.

Texas, 14 other US states, and the Commonwealths of Kentucky and Puerto Rico accused Google of unlawfully monopolizing the online ad market and rigging ad auctions in a December, 2020, lawsuit. The plaintiffs subsequently filed an amendment complaint in October, 2021, that includes details previously redacted.

On Friday, Texas et al. filed a third amended complaint [PDF] that fills in more blanks and expands the allegations by 69 more pages.

The fortified filing adds additional information about previous revelations and extends the scope of concern to cover in-app advertising in greater detail.

Presently, there are three other US government-backed unfair competition claims against Google ongoing: a federal antitrust lawsuit from the US Justice Department, a challenge from Colorado and 38 other State Attorneys General (filed around the same time as the Texas-led complaint), as well as a competition claim focused on Android and the Google Play Store filed last July.

- Advertisement -

The third amendment complaint delves into more detail about how Google allegedly worked “to kill header bidding,” which Google is said to have viewed as an existential threat to its position as an ad market gatekeeper. It elaborates on the negotiation between Google and Facebook to convince Facebook to stop supporting header bidding in exchange for favorable treatment. The deal, referred to as “Jedi Blue” internally and eventually as “Open Bidding” when discussed publicly, allegedly allowed Facebook to win ad auctions even when outbid by competitors.

The third amended complaint explains, “Facebook’s Chief Operating Officer [REDACTED] was explicit that ‘[t]his is a big deal strategically’ in an email thread that included Facebook CEO [REDACTED]. When the economic terms had taken their form, the team sent an email addressed directly to CEO: ‘We’re nearly ready to sign and need your approval to move forward.’ Facebook CEO wanted to meet with COO [REDACTED] and his other executives before making a decision.”

The resulting 2018 Google-Facebook “Jedi Blue” deal was, it’s claimed, ultimately signed by Philipp Schindler, SVP and head of Google advertising sales and operations and Facebook’s COO [REDACTED] – known to the world as Sheryl Sandberg, a member of Facebook’s board of directors who formerly served as Google VP of Global Online Sales and Operations.

“Google CEO Sundar Pichai also personally signed off on the terms of the deal,” the court filing says.

The expanded filing includes new allegations about how Google used Accelerated Mobile Pages to hinder header bidding.

- Advertisement -

What’s more, the revised filing adds support for the claim that a Google ad program called Dynamic Revenue Share or DRS cheated to help Google win more valuable ad impressions.

“DRS manipulated Google’s exchange fee after soliciting bids in the auction and after peeking at rival exchanges’ bids to win impressions it would have otherwise lost,” the revised complaint says.

And the complaint now contends that Google personnel admitted the unfairness of the DRS system: “Google internally acknowledged that DRS made its auction untruthful: ‘One known issue with the current DRS is that it makes the auction untruthful as we determine the AdX revshare after seeing buyers’ bids and use winner’s bid to price itself (first-pricing)….'”

Google has previously rolled its eyes at the Texas et al. lawsuit. In January, Adam Cohen, director of economic policy at Google, devoted a blog post to rebutting the allegations.

On the subject of header bidding, Cohen says Google created its alternative, Open Bidding, because header bidding has drawbacks.

- Advertisement -

“You won’t read this in AG Paxton’s complaint, but the technology has real drawbacks: Header bidding auctions take place within the browser, on your computer or mobile phone, so they require the device to use more data in order to work,” he wrote. “This can lead to problems like webpages taking longer to load and device batteries draining faster. And the multilayered complexity of header bidding can lead to fraud and other problems that can artificially increase prices for advertisers, as well as billing discrepancies that can hurt publisher revenue.”

Google also maintains a competition website through which the company can tell the world how “Google’s free products help people and small businesses across America.”

In an email to The Register, a Google spokesperson disputed the claims made in the latest complaint but didn’t respond to a request to detail specific inaccuracies.

“Despite Attorney General Paxton’s three attempts to re-write his complaint, it is still full of inaccuracies and lacks legal merit,” Google’s spokesperson said. “Our advertising technologies help websites and apps fund their content, and enable small businesses to reach customers around the world. There is vigorous competition in online advertising, which has reduced ad tech fees, and expanded options for publishers and advertisers. We’ll continue to fight this meritless lawsuit in court.”

Not to mention the other similar lawsuits. ®

NOW WITH OVER +8500 USERS. people can Join Knowasiak for free. Sign up on Knowasiak.com
Read More

- Advertisement -

1 Comment

  1. I have often heard that Google's dominance of the ad market is bad for ad space sellers, but this is the first time I've understood anything about the mechanisms.

    I looked up "header bidding" [1][2] and basically it seems to be a way for sellers to auction their space to all potential buyers at once, rather than letting Google be the middle-man and rig the game in its favor… for example, by reserving the last bid in an auction for Google Ad Exchange.

    No wonder Google is against it.

    [1] https://www.lotame.com/back-basics-header-bidding/

    [2] https://adage.com/article/digital/how-header-bidding-wars-le…

You might also likeRELATED
Recommended to you

The State of Web Scraping 2022

With 2021 having come to an end, now is the time to look back at the big events & trends in the world of web scraping, and try to project what will 2022 look like for web scraping. Including the good, the bad, and the ugly:"Web Scraping" Falling Out Of FashionAnti-Bots: The Arms Race ContinuesLegal…

Show HN: Nosigsegv – Say goodbye to crashes in your Go apps

Remove nil pointer problems from your go program! Usage If you are running a recent Linux version, you need to run the following command before using nosigsegv. sudo sysctl -w vm.mmap_min_addr=0 Now nil pointers are not going to crash your program anymore. Example Add the following line at the top of your go program: import…

The win is fucked

I have something to tell you, dear reader. The web is fucked. It’s a sad state of affairs that we’re in - gone are the days of Web 1.0 where the humble personal blog and the likes of GeoCities reigned supreme. Instead we’ve been left with Web 1.0’s rotten remains where centralisation, monopolies and tracking…

Prove HN: Bliss – A library for making beautiful audio playlists, written in Rust

An open-source library to make audio playlists by evaluating distance between songs. Note: this page is about bliss-rs. For the old bliss in C, see here. Index What is bliss? Download Library usage Technical details And blissv1? What is bliss? bliss is a library designed to make smart playlists, by evaluating distance between songs. It…
- Advertisement -

Thich Nhat Hanh, Vietnamese Zen Master, Dies at 95

Thich Nhat Hanh at the Plum Village monastery in southern France | Courtesy Plum Village Community of Engaged Buddhism Vietnamese Zen Master Thich Nhat Hanh—a world-renowned spiritual leader, author, poet, and peace activist—died on January 22, 2022 at midnight (ICT) at his root temple, Tu Hien Temple, in Hue, Vietnam. He was 95. “Our beloved…

Before wave of train thefts, Union Pacific laid off some of its police force

News organizations both locally and nationally have been covering the rise of cargo theft in L.A.’s northeast train tracks in the past few days. Anchors on morning news have been quick to point out that there have been over 100 arrests, and even Forbes have been quick to point out the staggering $5 million worth…

Must read

Sport engines as an art gather

The original article was written in July 2021, and was translated by Evan Ward. Thank you very much!It’s been more than eight years now since June 2013, when I made my first commit on Ebiten, a 2D game engine (or game library, if you prefer) that I’m still developing in my spare time to this…

Canary removing almost all security camera features from their free plan

Something went wrong, but don’t fret — let’s give...
- Advertisement -