Google’s advertising practices under the spotlight

A group of 50 attorneys general opened a broad investigation into whether advertising practices of Alphabet Inc.’s Google violate antitrust laws.

State attorneys general led by Ken Paxton of Texas announced the probe Monday on the steps of the Supreme Court in Washington, citing concerns that the company is raising costs for advertisers and questioning whether consumers are getting the best information from search results.

“This is a company that dominates all aspects of advertising on the internet and searching on the internet,” Paxton said.

Google is facing a rapidly expanding set of antitrust investigations, not only by dozens of states but also by the Justice Department and international enforcers, as governments grow increasingly skeptical of the company’s dominance and take steps to rein it in.

Shares of Google parent Alphabet slipped following the announcement. The stock was down more than 1% at 2:30 p.m. in New York, at $1,193.75, or about 8% below a record reached in late April.

The announcement by the states comes days after New York State Attorney General Letitia James announced she is leading a coalition of states in a wide-ranging investigation of Facebook Inc. The Google investigation is made up of 48 states, the District of Columbia and Puerto Rico.

“We are acting as one today in regards to launching what I know will be a fair and full investigation,” said District of Columbia Attorney General Karl Racine.

The developments create fresh problems for Facebook and Google after a wave of criticism by politicians from both parties over their market dominance. On Sept. 12, the House subcommittee focused on antitrust law will hold a hearing on the impact of data and privacy.

The Justice Department is also probing Google’s role in the online advertising market and its search operations, Bloomberg has reported, although it is not joining the state efforts. Google disclosed on Friday that the department had issued civil investigative demands, which are akin to subpoenas, for all documents in prior antitrust probes.

Now read: Facebook and Google face crackdown

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Google’s advertising practices under the spotlight