Google and Facebook are potentially in trouble after recently unsealed court documents revealed that the two companies, which you might assume to be tense rivals, in fact signed a secret bid to shore up the online advertising market.
According to the documents, reported by The Wall Street Journal and Politico, Texas and other US states allege that Meta CEO Mark Zuckerberg and Google CEO Sundar Pichai struck a secret deal in 2018 that gave preferences to Facebook on Google’s advertising auctions.
According to ad marketing firm GroupM, Facebook, Google and Amazon controlled 90% of the U.S. digital ad market in 2020, up from 80% in 2019, capturing more than 50% of U.S. ad spend in the process. The fact that the “triopoly” has such a grip only adds to the peril for Google and Facebook.
These are not the first details of this agreement. In December 2020, the Texas Attorney General and others made similar allegations regarding a secret deal between Facebook and Google.
Both companies deny that such an agreement exists or ever existed.
According to Steven Levy’s book on Facebook, Mark Zuckerberg used to end meetings by shouting “Domination!” ”, a practice that the company’s lawyers – who are wary of antitrust pressure, especially in Europe – quickly eradicated. But the principle has guided Facebook (and now Meta) since its inception, from “acting fast and breaking things” to today. The company has come under a lot of criticism over the past few years, some deserved, some exaggerated, and the alleged deal with Google seems pretty believable for those reasons.
Of course, the documents are from an ongoing court case and some of the actors, like Texas Attorney General Ken Paxton, a Republican, have been very critical in public of Google, Facebook and others. tech giants, especially when it comes to their treatment of Donald Trump.