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Axel Springer vs. Google

Fortune: “Axel Springer is at Google’s throat again. The German news-publishing giant (for which I worked in my days at Politico) has a long history of battling Google over the issue of so-called ancillary copyright fees—payments for carrying snippets of text and thumbnail images in search results. But now it’s waging war on another front: advertising technology.Together with more than two dozen other European media groups, Springer yesterday launched a $2.3 billion lawsuit against Google in the district court of Amsterdam, which is a major European destination for antitrust damages claims. The publishing houses claim that Google has abused its dominant position in the adtech market, causing them significant losses in ad revenue and forcing them to pay excessive fees for using its adtech services. What exactly is Google supposed to have done wrong? In the words of the claimants’ lawyers, the company has acted as “broker, auctioneer and sales agent at the same time,” representing all sides in the ad-buying process—and preferencing itself the whole way. “If we compare ad auctions to a stock exchange, Google would represent both sellers and buyers, while also owning the exchange itself, thus creating a clear conflict of interest,” they explain. Google’s response to the suit is that it’s “speculative and opportunistic,” which is quite rich, given that Google had to pay a $268 million French antitrust fine less than three years ago over the same issue. Around the same time, the European Commission started sniffing around the firm’s playing-all-sides adtech model, and last June it formally charged Google for illegally abusing its position (if you’d like to see some neat diagrams of how Google’s strategy works, check out the Commission’s formal statement of objections). If it loses the case, Google would have to break up its ad business, which accounts for the vast majority of its revenue…”

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