Jedi Blue – Google & Facebook’s reported deal to limit ad competition

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The past year has seen a number of big tech firms come under fire for antitrust behaviour, resulting in lawsuits in particular for Google and Facebook in the US. With those aforementioned lawsuits ongoing, a recent report from the New York Times cites a deal referred to as Jedi Blue.

The report alleges that Google and Facebook cut a deal that would limit the amount of advertising competition that the latter would run into. If true, it pretty much falls under the definition of antitrust.

Jedi Blue was discovered in Texas antitrust lawsuit documents obtained by the publication, with Google giving Facebook preference in ad header billing in 2018, where sites could solicit ad space bids from multiple exchanges at once, in return for backing Google’s Open Bidding approach to selling those ads.

The sweetheart deal, as it is called, gave Facebook a distinct advantage over other platforms, allowing it to have more time to bid for ads, have direct deals with sites hosting the ads, along with giving Google insight into audience behaviours, the report claims.

Furthermore Facebook said it would bid on at least 90 percent of ad auctions when it could identify users, and promised minimum spending levels up to $500 million per year.

If true, the report could prove damning, especially as other Google partners did not get nearly the same sort of deal from the company.

Since the publication of the report, as well as the implications it would have on its ongoing lawsuit, Google has commented on the matter in a blog post calling the allegations “baseless” and noting that such deals in fact increase competition in the industry and do not limit it.

“Our ad tech rivals and large partners may not always like every decision we make—we’re never going to be able to please everybody. But that’s hardly evidence of wrongdoing and certainly not a credible basis for an antitrust lawsuit,” writes Adam Cohen, director of economic policy at Google.

With Jedi Blue now public knowledge, it is likely that it is referenced in the other multi-state antitrust lawsuits that Google and Facebook are currently facing.

As such, it will be interesting to see what the outcome is.

[Image – Photo by NeONBRAND on Unsplash]

Robin-Leigh Chetty

Robin-Leigh Chetty

When he's not reviewing the latest smartphones, Robin-Leigh is writing about everything tech-related from IoT and smart cities, to 5G and cloud computing. He's also a keen photographer and dabbles in console games.