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Google target of antitrust investigation led by 50 U.S. states and territories

Attorneys general for 50 U.S. states and territories on Monday officially announced an antitrust investigation of Google, embarking on a wide-ranging review of a tech giant that Democrats and Republicans said may threaten competition, consumers and the continued growth of the web.

Appearing on the steps of the Supreme Court, Texas Attorney General Ken Paxton charged that Google “dominates all aspects of advertising on the Internet and searching on the Internet,” though he cautioned that despite his criticism the states had launched an investigation for now and not a lawsuit.

Paxton said the probe’s initial focus is online advertising. Google is expected to rake in more than $48 billion in U.S. digital ad revenue this year, far outperforming its peers, while capturing 75 per cent of all spending on U.S. search ads, according to eMarketer.

“They dominate the buyer side, the seller side, the auction side and the video side with YouTube,” he said during a news conference alongside officials from 11 states and the District of Columbia.


Karl Racine, District of Columbia attorney general, center left, speaks as Ken Paxton, Texas attorney general, center right, listens during a news conference outside the Supreme Court in Washington, D.C., U.S., on Monday, Sept. 9, 2019.

Andrew Harrer/Bloomberg

Some of those attorneys general appeared to raise additional complaints about Google, ranging from the way the company processes and ranks search results to the extent to which it may not fully protect users’ personal information. Their early rebukes raised the stakes for Google, threatening top-to-bottom scrutiny of its sprawling business beyond just ads. Paxton promised the probe would go wherever the facts lead.

“There’s nothing wrong with being a dominant player when it’s done fairly,” said Sean Reyes, the Republican attorney general of Utah. He said there is a “presumption” of innocence in such an investigation but still said there is a “pervasiveness” to complaints about Google’s business practices.

Jeff Landry, a Republican from Louisiana, added: “We’re here because there’s an absolutely existential threat to our virtual marketplace.”

Google declined to comment, pointing to its previous statements saying it will work with state officials.

The probe marks the latest regulatory headache for Google and the rest of Silicon Valley, which have faced growing criticism – and widening state and federal scrutiny – into whether they’ve grown too big and powerful, undermining rivals and resulting in costlier or worse service for web users. The Washington Post first reported the states’ plans for a Google probe last week.

I want the best advice, from the best doctors — not the doctor, not the clinic who can spend the most on advertising

For Google, though, the states’ investigation comes more than six years after federal watchdogs wrapped up an antitrust investigation into its search and advertising practices and opted against bringing major penalties against the company, including breaking it up. Regulators around the world, meanwhile, have been more skeptical of Google: The European Union has issued the company $9 billion in competition-related fines over the past three years.

The states’ investigation is led by Texas’ Paxton and seven other attorneys general, four Democrats and four Republicans in total. Every state except Alabama and California, the home of Silicon Valley, so far has signed onto the bipartisan effort, as have Puerto Rico and the District of Columbia. A spokeswoman for California’s attorney general did not immediately respond to a request for comment.

Already, state officials have sent official legal demands for documents to the tech giant related to the investigation of online ads, Paxton told reporters.

Ashley Moody, the Republican attorney general of Florida, said the states’ Google probe starts with the company’s vast data stores. “Google monitors our online behavior, and captures data on every one of us as we navigate the internet,” she said. “This investigation will initially focus on capture of that information and whether Google embedded itself on every level of the online market [for] ad sales to monopolize this industry.”

Leslie Rutledge, a Republican attorney general from Arkansas, described Google as an “online search engine juggernaut,” raising her concern that searches for businesses, including doctors, are colored by the way the tech giant’s algorithms and advertising systems work.

“I want the best advice, from the best doctors — not the doctor, not the clinic who can spend the most on advertising,” she said.

The states’ investigation arrives as the Department of Justice and FTC also are scrutinizing Big Tech, and DOJ has taken early interest in Google. The agency issued its first legal demand for records at the end of August, according to a securities filing Google made Friday.

Another group of 11 state attorneys general – led by New York’s Letitia James – has begun their own probe against Facebook, exploring whether it violates competition laws and mishandles consumers’ personal information.

We’re here because there’s an absolutely existential threat to our virtual marketplace

Some state leaders said they are working closely with their federal counterparts as these investigations unfold. But Karl Racine, the Democratic attorney general for Washington, D.C., and a participant in both the Facebook and Google probes, said he and his peers wouldn’t hesitate to forge ahead if Washington once again opts against taking action against the tech giants.

“The state attorneys general, they are an independent bunch, and they can be quite tenacious,” he said . “So I’m very confident that this bipartisan group is going to be led by the facts, and not be swayed by any conclusion, that may fall short, if you will, if it’s inconsistent with our facts, on the [federal] side.”

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