Google and Facebook execs allegedly signed off 'illegal' ads deal – Business Insider

Google and Facebook execs allegedly signed off 'illegal' ads deal – Business Insider

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Google CEO Sundar Pichai and Meta chief exec Mark Zuckerberg personally signed off on an illegal advertising deal in 2018, according to newly unredacted US court filings that claim collusion at the very top of both firms.
According to the complaint, first filed by a coalition of states in 2020, the deal guaranteed that Facebook would both participate in and win a fixed percentage of Google’s online ad auctions, in what the plaintiffs describe as an “illegal price-fixing agreement.
As Insider’s Lara O’Reilly wrote in April, Google dominates how marketers buy ads, the tech which sites use to sell ads, and the exchange that connects the two. The suit alleges that Google used its dominant position and “exclusionary tactics” to distort competition in online ads.
Most of the allegations in the suit hinge on Google’s fear of “header bidding,” an alternative to its own ad auctioning practices described as an “existential threat” to the company.
Header bidding was developed by a roster of independent ad tech players that compete with Google as a way to democratize the way ad slots on publishers’ sites get filled, and maximize their ad revenue.
Per the suit, Google executives were worried by Facebook’s early moves into this space around 2017, and sought to bring the rival tech giant on board as a partner, rather than risk greater competition.
The lawsuit cites an email from Facebook COO Sheryl Sandberg, sent to Zuckerberg and other execs, in which she describes the potential partnership as “a big deal strategically.”
The execs’ names are redacted, but their titles are given in the suit.
Sandberg is alleged to have followed up with an email sent directly to Zuckerberg, writing: “We’re nearly ready to sign and need your approval to move forward.”
It was previously reported that this 2018 agreement, codenamed “Jedi Blue” internally, was allegedly signed by Sandberg and Google’s chief business officer Phillip Schindler. 
The unredacted lawsuit also contains further details of “Project Bernanke,” a secret initiative through which Google allegedly used bidding data collected from outside advertisers using its exchange to benefit its own ad system. The allegations around Project Bernanke appeared to back up industry concerns that Google dominating every aspect of the online ad ecosystem gives it an advantage over more specialist firms.
The lawsuit alleges Google’s AdX exchange sometimes overcharged advertisers bidding for space on publishers’ websites, allowing the tech giant to pocket the difference.
These additional funds were then placed in a pool and redistributed among advertisers bidding for space using Google tools, in order to artificially boost their performance, according to the complaint.
The antitrust lawsuit was first filed in 2020, fronted by Ken Paxton, the Attorney General of Texas, and was originally heavily redacted. The new revelations follow a judge order on Friday to unseal parts of the amended complaint.
Paxton led a coalition of states who alleged the tech giant had used “exclusionary tactics” in order to distort competition in the online ad market.
Google previously told Insider that’s Paxton’s lawsuit was “meritless,” adding: “We will strongly defend ourselves from his baseless claims in court.”
A Meta company spokesperson told the Guardian on Friday: “These business relationships enable Meta to deliver more value to advertisers while fairly compensating publishers, resulting in better outcomes for all.” 
Insider approached Google and Meta for further comment. 
Do you work at Google? Got a tip? Contact reporter Martin Coulter via email at, or via encrypted messaging app Signal at +447801985586.
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