Benzinga | Oct 22, 2021 04:02PM EDT

Antitrust Suit Targets Google's Ad Rates: What You Need To Know



* Alphabet Inc's (NASDAQ:GOOG) (NASDAQ:GOOGL) Google takes a cut of 22% - 42% of U.S. ad spending that goes via its systems, according to a newly unredacted lawsuit by state attorneys general, the Wall Street Journal reports.

* The Texas-led suit alleges that Google charges 2-4x for advertising transactions on its exchange versus rival digital advertising exchanges.

* "[T]he analogy would be if Goldman Sachs Group Inc (NYSE:GS) or Citigroup Inc (NYSE:C) Citibank owned the NYSE [New York Stock Exchange]," one senior Google employee said, the suit alleged.

* Google denied the allegations.

* The lawsuit alleged Google deploying strategies to "lock-in" publishers and advertisers and help the company's ad-buying tools win over 80% of auctions on its exchange.

* Google officially served 75% of all online ad impressions in the U.S. during Q3 of 2018.

* The suit cited programs, with code names like Bell, Elmo and Poirot, helping Google generate over $1 billion in sales.

* The lawsuit alleged that Google's business practices inflated advertising costs and passed them on to consumers in higher-priced products.

* The lawsuit alleged that Google crushed competition from rival exchanges and restricted websites' options for ad delivery.

* Price Action: GOOG shares traded lower by 2.88% at $2,773.50 on the last check Friday.