A major class-action lawsuit has been filed against Google’s parent company, Alphabet, by British advertisers who are demanding £5 billion (€5.83 billion) in damages. The plaintiffs accuse the tech giant of inflating ad prices by using its market dominance to force companies into paying higher rates for advertisements.

The Lawsuit and Its Allegations

The suit, filed by competition law professor Or Brook, claims Google has manipulated its market position to exclude competitors from both the search engine and advertising markets. Brook alleges that Google’s actions have led to inflated ad pricing, severely limiting the options available to businesses. According to the legal team, Google’s control over the market, through limiting competition, has unfairly impacted advertisers and raised costs across the board.

“The legal team argues that Google has used its dominant market position to lock out rivals and drive up advertising prices,” said Brook, who is leading the charge in the class-action lawsuit.

Accusations of Anti-Competitive Deals

The lawsuit also targets Google’s partnerships with key players in the tech industry. The class action claims that Google pressured Android phone manufacturers to preinstall its services, such as Chrome and Google Search, on their devices. Additionally, Google is accused of paying Apple billions of dollars to keep its search engine as the default option on Safari. These actions, according to the lawsuit, gave Google the leverage to demand what are described as “supra-competitive” rates for advertising, which are above what would be considered fair market prices.

Brook argues that UK businesses, in particular, have no alternative but to use Google Ads due to the lack of viable competition in the digital ad space. This market dominance, the lawsuit claims, has significantly harmed smaller companies that rely on advertising revenue to grow and compete.

Potential Impact on UK Advertisers

The class action lawsuit could have wide-reaching implications if successful. It seeks to compensate every UK-based company that has purchased Google ads since 2011, and could result in significant financial restitution. Google’s pricing practices are under scrutiny as part of the broader issue of market manipulation and the elimination of competition.

If the lawsuit succeeds, it could force Google to revise its ad pricing model, leading to lower costs for businesses that depend on advertising to reach customers. However, the case remains in its early stages, and its outcome will likely depend on the court’s interpretation of Google’s actions under UK competition law.

Growing Global Scrutiny on Google

The lawsuit comes amid mounting global pressure on Google to reform its advertising and search engine practices. The UK’s Competition and Markets Authority (CMA) recently launched an investigation into Google’s dominance of the search ad market, questioning whether the company’s practices are detrimental to fair competition. Similarly, Japan has joined the growing list of countries scrutinizing Google’s business practices. The Japanese government recently ordered the company to cease conduct deemed in violation of its antitrust laws, marking the first time such an action has been taken against Google in the country.

The worldwide criticism highlights growing concerns about the market power of large tech companies and their potential to distort fair competition. Critics argue that Google’s exclusive contracts and partnerships have led to unfair advantages, especially for small and medium-sized businesses.

Brook, the lead lawyer in the lawsuit, emphasized that the legal battle is about ensuring fair competition in the digital advertising space. “We aim to hold Google accountable for its actions that have undermined the integrity of digital markets,” he stated.

The Future of Digital Market Regulation

The lawsuit is part of a broader push by regulators around the world to reign in the power of tech giants like Google. As calls for stricter regulations grow louder, the case may serve as a pivotal moment in the ongoing debate about how to balance competition with corporate dominance in the digital economy.

Euronews Next reached out to Alphabet for a comment on the ongoing legal proceedings, but as of publication, no official response had been received.

With the digital advertising sector increasingly under the microscope, the outcome of this case could reshape the landscape for tech companies and advertisers alike. As regulators continue to examine Google’s practices, the question remains: how will the tech industry evolve in the face of growing calls for more stringent oversight?