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The next bullet in the ongoing war between publishers old and new and the big tech platforms should be lying right now on Treasurer Frydenberg’s desk, waiting for him to pull the trigger to approve its public release.

The interim report on digital advertising services from the Australian Competition and Consumer Commission looks at how Australia’s $3.3 billion display market came to be dominated by the US platforms, Google and Facebook. The report was due with Frydenberg by December’s end.

The report will be “globally significant” ACCC chair Rod Sims said this week.

The report is about lifting the lid on what’s been identified as the largest and most complex financial trading market in the world — the market for digital display ads, where the tech pair share an effective monopoly. (“Display” is all online ads other than classifieds and search — also dominated by Google.)

How did the platforms get there? In short, they cheated. At least that’s the view  from 10 (all Republican) states who’ve joined in the Texas-led law­suit against Google for anti­com­pet­i­tive prac­tices last month.

Relying on internal Google documents, the 10 states claim that, to dominate advertising, “Google sought to kill competition and has done so through an array of exclusionary tactics.” This included “an unlawful agreement with Facebook, its largest potential competitive threat, to manipulate advertising auctions.”

The states say: “to cement its dominance across online display markets, Google has repeatedly and brazenly violated antitrust and consumer protection laws. Its modus operandi is to monopolize and misrepresent. Google uses its powerful position on every side of the online display markets to unlawfully exclude competition.”

How have they got away with it? Simple: the technology of the ad tech has made it all too hard to understand. The states say that Google waived off attention with its “Don’t Be Evil” schtick, helped by “the extreme opacity and complexity of digital advertising markets”.

Ad tech is opaque by design, working in real time to dynamically link advertisers and consumers. Ads are no longer targeted at, say, a typical Age reader. They’re aimed at a personal profile, put together by the platforms’ algorithms, who just happens to be reading The Age at the time the ad is served to them.

In this world, publications offer space online to be aggregated in supply side platforms. Advertisers meanwhile post their ads with a demand that they reach certain audiences. An exchange in between matches the two sides based on Google’s behavioural data.

Google uses its dominance of search and of browsing (though Google Chrome, the subject of a separate anti-trust action by the US Department of Justice) to own the behavioural data it needed to dominate each of the three steps.

Facebook uses its dominance of social media (including ownership of Instagram) to pocket about $1 billion, or about 30% of Australia’s display advertising spend. (Google also picks up about $120 million from YouTube ads in Australia as well as $3.5 billion in search.)

Then comes the ad tech money. The 10 US states say: “Google was able to demand that it represent the buy-side, where it extracted one fee, as well as the sell-side, where it extracted a second fee, and it was also able to force transactions to clear in its exchange, where it extracted a third, even larger, fee.”

The result, according to a UK study last year, is that less than half of all ad dollars end up making it through to the publications (and the journalism) it’s meant to support.

So far, no surprise. The shock in the states’ case was the claim of collaboration between Facebook and Google to cooperate on bidding for ads, exchange information and keep prices high, although the key evidence for this has been redacted. Maybe we’ll find out more when the ACCC report is released.

More, the states accused Google of having a  documented plan “to capture online publishers on the open internet and transform them into content creators generating revenue for Google on a completely closed platform — like YouTube content creators”.

Back in Australia, Google is reposting its offer to settle the mandatory news bargaining code with its offer to pay to re-publish articles in the Google News Showcase with a global US$1 billion fund. It’s experimenting to de-prioritise news in general search.

The US case shows why Australian publishers are suspicious of the Google offer.