The Wall Street Journal had previously reported on aspects of the draft complaint.
The wave of recent antitrust cases brought against Google and Facebook has thrown a spotlight on profitable deals among Big Tech. In October, the Justice Department sued Google and reached an agreement with Apple to introduce Google as the pre-selected search engine on iPhones and other devices.
“This idea that the major technology platforms are competing strongly with each other is overblown,” said Sally Hubbard, a former assistant attorney general at the New York antitrust bureau who now works at the Open Markets Institute, a think tank. “In many ways, they reinforce each other’s monopoly power.”
Google and Facebook accounted for more than half of all digital advertising spending in 2019. In addition to displaying advertising on their own platforms, such as the Google search engine and the Facebook homepage, websites, developers apps and publishers rely on companies to ensure advertising for their pages.
The agreement between Facebook and Google, code-named “Jedi Blue” within Google, concerns a growing segment of the online advertising market called programmatic advertising. Online advertising raises hundreds of billions of dollars in global revenue each year, and the automated purchase and sale of advertising space accounts for more than 60% of the total, according to the researchers.
Within milliseconds between a user clicking a link to a web page and loading the page’s ads, bids for the available ad space are placed behind the scenes in markets known as exchanges, with the winning bid passed to an ad server . Since Ad Exchange and Google’s ad server were dominant, they often directed the business to their own market.
A method called header bidding has emerged, in part as an alternative solution to reduce reliance on Google’s ad platforms. News media and other sites can request bids from multiple exchanges at the same time, helping to increase competition and leading to better prices for publishers. In 2016, more than 70% of publishers had adopted the technology, according to one estimate.
Seeing a potentially significant business loss due to header bidding, Google developed an alternative called Open Bidding, which supported an exchange alliance. While Open Bidding allows other exchanges to simultaneously compete with Google, the search firm charges a fee for each winning bid, and competitors say there is less transparency for publishers.