New details have emerged about the understanding that Google and Facebook would have developed to arrange the profitable online advertising market.
The two tech titans christened their contract “Jedi Blue”, according to an unwritten version of the successful Texas suit launched against the companies and obtained by the Wall Street Journal.
The lawsuit, initiated earlier this month, says the code name was “a twist on a Star Wars character name,” suggesting it may be related to Aayla Secura, a blue Jedi.
Google’s “illegal agreement” with Facebook was allegedly created in exchange for the Mark Zuckerberg-led company refusing to adopt a method of advertising sales called header bidding, which posed a threat to Google’s iron grip on the digital advertising market.
Header bidding had helped website publishers bypass the Google marketplace for buying and selling digital ads and leading to more favorable prices for publishers. The alternative network was so successful that by 2016, about 70 percent of major Internet publishers used it, according to the state lawsuit.
If a major rival, such as the Facebook Audience Network or FAN, embraced the header, Google’s profitable monopoly on the advertising market would be able, the states said.
“We have to fight against the existential threat posed by the bidding of the header and [Facebook Audience Network]”, Wrote a Google advertising director in a 2017 e-mail referred to in the process.
That’s when Google approached Facebook about giving up the header bid. Instead, Google allegedly reduced Facebook’s transaction fees to between 5 and 10 percent, well below the 20 percent it charged others.
Facebook was also able to send its bids directly to the Google ad server, rather than through an exchange, according to the report.
The search giant also kept Facebook up to date with the advertising opportunities that were the result of the bot’s activity, helping the social network not to waste its money on unnecessary impressions. Google declined the same information as the other bidders, the report said.
“Finally, Facebook has narrowed its involvement in header bidding in exchange for Google providing Facebook information, speed and other benefits,” the lawsuit said.
Google responded that it had not manipulated any bids and said that another 25 companies were participating in its open auction advertising program.
“It simply came to our notice then [Facebook’s] involvement and do not receive data that is not made similarly available to other buyers, ”said Google.
Facebook also has almost twice as much time as auctioneers to “recognize” mobile and web users and then bid on ads, according to the unedited process.
The Texas-led case is key to Google, which relies on advertising for much of its profits. The parent company, Alphabet, posted $ 37.1 billion in digital advertising revenue in its latest quarterly report.