New details have emerged about the deal that Google and Facebook allegedly drew up to prepare the lucrative online advertising market.
The two tech titans christened their contract “Jedi Blue,” according to an unwritten version of the Texas box office lawsuit filed against the companies and obtained by the Wall Street Journal.
The lawsuit, filed earlier this month, says the code name was “a twist on a Star Wars character’s name,” suggesting it may be linked to Aayla Secura, a blue Jedi.
Google’s “illegal deal” with Facebook was allegedly created in exchange for Mark Zuckerberg-led company refusing to adopt a method of selling ads called header bidding, which posed a threat to the firm. Google’s subjection to the digital advertising market.
Header bids had helped website publishers bypass Google’s marketplace to buy and sell digital ads, and had been driving more favorable prices for publishers. The alternative network was so successful that in 2016, approximately 70 percent of major web publishers used it, according to state demand.
If a major rival like Facebook Audience Network or FAN ad service adopted the header link, Google’s profitable monopoly on the advertising market would be kaput, according to the states.
“The existential threat posed by headline tenders and [Facebook Audience Network]”, Wrote a Google advertising executive in a 2017 email referring to the lawsuit.
That’s when Google turned to Facebook about abandoning header bids. In return, Google allegedly lowered Facebook’s transaction fees by 5 to 10 percent, well below the 20 percent it charged other people.
According to the report, Facebook was also able to send its bids directly to Google’s ad server, rather than through an exchange.
The search giant also kept Facebook abreast of advertising opportunities that were the result of the bot’s activity, helping the social network avoid wasting its money on useless impressions. Google denied the same information to other participants in the auction, according to the report.
“In the end, Facebook reduced its stake with header bids in exchange for Google giving information, speed, and other benefits to Facebook,” the lawsuit alleged.
Google responded that it was not manipulating any auction and said another 25 companies were participating in its open bidding advertising program.
“There is nothing exclusive [Facebook’s] and they don’t receive data that isn’t provided in a similar way to other buyers, ”Google said.
Facebook is also given almost twice as much time as auction competitors to “recognize” mobile and web users and then make bids for ads, according to the unwritten demand.
The Texas-led case is critical to Google, which relies on advertising for much of its profits. Its parent company, Alphabet, posted $ 37.1 billion in digital advertising revenue in its latest quarterly report.