European Publishing Groups Sue Google for $2.3 Billion Over Advertising Practices

European Publishing Groups Sue Google for $2.3 Billion Over Advertising Practices

The claim filed by publishers, including Spain’s Prensa Ibérica, alleges that Google “abused its dominant position” in digital advertising technology

The world’s most-used internet search engine, Google, owned by Alphabet, has been sued in the Amsterdam District Court (Netherlands) for 2.1 billion euros ($2.3 billion) by 32 European media groups, including Spain’s Prensa Ibérica (publisher of a score of newspapers in Spain), Germany’s Axel Springer, and Norway’s Schibsted, alleging they had suffered losses due to the company’s practices in digital advertising, the British newspaper The Guardian reported this Wednesday.

The action by the groups – which include publishing companies in Austria, Belgium, Bulgaria, the Czech Republic, Denmark, Finland, Hungary, Luxembourg, the Netherlands, Norway, Poland, Spain, and Sweden – comes at a time when antitrust regulators are also cracking down on Google’s technology advertising business.

The involved media companies have suffered losses due to a less competitive market, which is a direct consequence of Google’s misconduct,” their lawyers, Geradin Partners and Stek, claim in a statement.

“Without Google’s abuse of its dominant position, media companies would have received significantly higher advertising revenues and would have paid lower fees for advertising technology services. Fundamentally, these funds could have been reinvested to strengthen the European media landscape,” the lawyers said.

In the lawsuit, they cited the 220 million euro fine by the French competition authority against Google for its advertising technology business in 2021, as well as charges by the European Commission last year to support their group claim.

“If regulatory scrutiny is met, Google may need to restrict its practices and offer more consistent and predictable pricing to its advertising customers,” said Gil Luria, analyst at DA Davidson & Co.

The lawsuit comes at a time when Google’s main advertising business faces an existential threat from the shift to generative AI chat, Luria added.

In a statement, a Google spokesperson said the company opposes the lawsuit and added that it is “speculative and opportunistic.”

“Google works constructively with publishers across Europe. [Our advertising tools] adapt and evolve in partnership with those same publishers.”

Last year, Google said it disagreed with the EU’s antitrust charges against its advertising technology business, where it participates both as a buyer and seller in the supply chain.

In recent years, publishers around the world have complained about the growing dominance of big tech in advertising as their share of revenue declines. Google is the world’s most dominant digital advertising platform, according to analysts.

The group said they filed the lawsuit in a Dutch court due to the country’s reputation as a key jurisdiction for antitrust damage lawsuits in Europe and to avoid multiple lawsuits in different European countries.

Other members of the group include Austria’s Krone, Belgian groups DPG Media and Mediahuis, Denmark’s TV2 Danmark A/S, Finland’s Sanoma, Poland’s Agora, and Switzerland’s Ringier.