Facebook, Google Face Antitrust Lawsuit Charges

Facebook (Chris Ratcliffe/Bloomberg via Getty Images)

A West Virginia newspaper has filed an antitrust suit against the tech giants, Facebook and Google for their ad activities. The two reportedly received almost 50% of all digital ad dollars in the United States are are also already facing antitrust charges from both federal and state authorities. 

Facebook, Google Sued

The company HD media, is the owner of various papers in the state, not limited to the Herald-Dispatch in Huntington and the Charleston Gazette-Mail.

HD Media accuses Google of having so monopolized the online ad market that it has become a threat, as reported by AP News

"It threatens the extinction of local newspapers across the country," the suit reads.

The suit also alleges that Google and Facebook have entered into a conspiracy to increase thei dominance in the market. They have entered into secret agreement, the suit alleges, citing an early lawsuit filed by 10 Republican attorneys general in December 2020. 

The company however, did not clarify exactly how the behavior of Facebook and Google has affected it, apart from saying that it has hurt its ability to "effectively monetize its content."

The company alleged that Google has acquired noncompetitive share of the news publisher's ad revenues and it is unfair. A lawyer for the company refuses to clarify further. 

According to David Chavern, the head of News Media Alliance, this is the first ever antitrust lawsuit against a tech platform that focuses mainly on news publishing.

He clarified there is no involvement of the group in the suit. 

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Newspaper Industry in Decline

HD Media filed the antitrust suit in a federal court in West Virginia and prayed for a jury trial. It is seeking unspecified damages and asking the court to stop Google and Facebook from engaging further in the noncompetitive conduct it is accusing the giants of. 

Facebook and Google reacted differently to the suit.

Facebook has not replied to requests for comment. While Google referred a reporter who asked for comment to a blog post published in mid-January by its director of economic policy, Adam Cohen. The blog essentially defends Google's business against antitrust charges that it already faced from a Texas attorney general back in December. 

Essentially, the blog states that Google has nothing in mind behind its advertising strategies but to make customer have a better search experience. Customer satisfaction is the sole intention and nothing else. 

It's not only this West Virginia newspaper that is affected by tech platforms though. 

The overall newspaper industry has been on a long decline, which shows increasing rates of unemployment.

At the same time, publications are getting thinner and even disappearing. Even though they tapped into online platforms themselves, online ad revenues were not enough to offset print-ad losses. 

Federal and state antitrust authorities have sued both Google and Facebook in recent months. The Justice Department is accusing Google of abusing its prowess in both online search and advertising.

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