Google faces $2.3bn lawsuit from European media groups: Here's why
Google is facing a massive $2.3 billion lawsuit from 32 media groups, including big names like Axel Springer and Schibsted. These publishers from 13 European countries claim that Google's digital advertising practices have caused them financial losses. According to their lawyers, Geradin Partners and Stek, "The media companies involved have incurred losses due to a less competitive market, which is a direct result of Google's misconduct."
These companies are part of the lawsuit
The lawsuit includes publishers in Austria, Bulgaria, the Czech Republic, Denmark, Belgium, Finland, Norway, and Poland. Hungary, Luxembourg, Spain, Sweden, and the Netherlands, are also included. Austria's Krone, Spain's Prensa Iberica, Switzerland's Ringier, Belgian firms DPG Media and Mediahuis, Poland's Agora, Denmark's TV2 Danmark A/S, and Finland's Sanoma are some of the litigants.
Impact on European media landscape and regulatory scrutiny
The media groups' legal team argues that if Google hadn't abused its dominant position, these companies would have earned more from advertising and paid less for ad tech services. They believe that this money could have been used to strengthen the European media landscape. The lawsuit points to the French competition authority's €220 million fine against Google in 2021 and the European Commission's charges last year as evidence supporting their case.
Google's response and existential threat from AI chat
Google, however, isn't taking this lawsuit lying down. A spokesperson for the company called the legal action "speculative and opportunistic," adding that "Google works constructively with publishers across Europe. [Our advertising tools] adapt and evolve in partnership with those same publishers." Analyst Gil Luria from DA Davidson & Co mentioned that Google's core advertising business faces potential threat from the rise of generative AI chat. This could force the company to change practices and offer more consistent pricing to advertisers.