Small Businesses Say Google Ad System Is Unfair, Amid DOJ Lawsuit

November 3, 2020 Updated: November 3, 2020

While Google was sued by the Justice Department (DOJ) for anti-competitive behavior due to the firm’s dominance in online search and advertising, small-business owners say the issue that affects them is Google’s ranking system.

Usually, companies compete to take the top spots in Google’s search results, on the first page and the subsequent pages after. But if too many companies vie for one of these spots, the cost can jump out of reach quickly for a small business, as with the price for prime time TV commercials.

Business owners’ concerns about the cost of advertising aren’t directly related to the government’s lawsuit, although Google’s dominance of the search market is seen as a factor in driving up the price of ads in its vast digital marketing network.

Matt Berman, founder and CEO of the digital marketing firm Emerald Digital, says Google’s dominance is so extreme that his business has “no option but to use Google platforms in order to compete.”

“Prime visibility on Google platforms is essential for our marketing clients,” Berman previously told The Epoch Times. “Google’s dominance in organic search means our clients must rank for organic search results, we must cleverly use Google pay-per-click ads, we must properly utilize Google My Business, and the list goes on.”

Currently, Google is a “one-stop-shop with incredible targeting,” Berman said, noting that any change when it comes to a potential break-up would have drastic effects—both positive and negative—on how his clients do business.

Epoch Times Photo
Attendees wait in line to enter a Google product launch event at the SFJAZZ Center in San Francisco on Oct. 4, 2017. (Elijah Nouvelake/AFP via Getty Images)

Last year, the European Commission fined the company about $1.7 billion over alleged abusive practices in online advertising. The suit was the third billion-dollar antitrust penalty the commission has handed to Google in recent years.

Larger companies with more money to spend, in theory, can always outbid smaller businesses vying for the prime advertising spots on Google.

“You keep getting squeezed further and further down the search results page,” Bryan Clayton, CEO of GreenPal, told The Associated Press. GreenPal operates an app to help homeowners find lawn care.

“As a startup, you don’t have a million-dollar advertising budget.”

Google controls about 90 percent of global internet searches. Berman said that “we are forced to use their search and marketing products if we need to succeed.” He noted that while some of the ad products are good, others aren’t.

Businesses have two main ways of trying to place their listings high in Google rankings. One is to buy an ad that’s seen at the top of the search result pages; the cost for the ads depends on how often a computer user clicks on the ad and how much a company is willing to pay per click.

There’s also what’s called paid search, where companies bid on keywords to get a higher ranking.

a Google sign
A Google sign at one of the company’s office complexes in Irvine, Calif., on July 27, 2020. (Mike Blake/Reuters)

Tommy Fang, co-founder of the New York-based Eureka Surveys, said he tried Google to advertise his year-old market research company, but the cost far outweighed the business he hoped it would bring in.

“We ran a couple of ads and the economics just didn’t work out for us,” Fang told The Associated Press. The company runs a website where people can take part in surveys.

The lawsuit that was filed on Oct. 20 by the DOJ and 11 states asserts that Alphabet Inc.’s Google has tried to maintain its status as a gatekeeper to the internet by using a number of interlocking businesses to shut out competitors, thereby securing itself as a monopoly.

Experts told The Epoch Times that the suit marks the biggest antitrust case in a generation—comparable to the lawsuit against Microsoft Corp. filed in 1998 and the 1974 case against AT&T, which led to the breakup of the Bell System. The DOJ’s action has generated bipartisan support.

The department claims the company uses billions of dollars from its advertisements to pay carriers, browsers, phone companies, and other entities to maintain Google as a default search engine.

The potential breakup of Google has been a divisive issue among policy and antitrust experts. The lawsuit is likely to take years to resolve.

The Associated Press contributed to this report 

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