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News publisher files class action antitrust lawsuit against Google, citing damage AI is doing to their bottom line

A new class action lawsuit filed this week in U.S. District Court in DC accuses Google and parent company Alphabet of anticompetitive conduct in violation of U.S. antitrust laws, the Sherman Act and others, on behalf of news publishers.

The case, filed by Arkansas-based publisher Helena World Chronicle, alleges that Google “siphons” content from news publishers, their readers and advertising revenue through anticompetitive means.

It also specifically mentions new AI technologies such as Google’s Search Generative Experience (SGE) and Bard AI chatbot as exacerbating the problem.

In the complaint, Helena World Chronicle, owner and publisher of two weekly newspapers in Arkansas, alleges that Google is “starving the free press” by sharing publishers’ content on Google, causing them to lose “billions of dollars.”

In addition to new AI technologies, the lawsuit also points to Google’s older question-and-answer technologies, such as the “Knowledge Graph” launched in May 2012, as part of the problem.

“When a user searches for information about a topic, Google displays a ‘Knowledge Panel’ to the right of the search results.

This panel contains a summary of content from the Knowledge Graph database,” the complaint states.

“Google built this massive database by extracting information from publishers’ websites – what Google calls ‘material shared on the Internet’ – and from ‘open source and licensed databases,’” it says.

In 2020, the Knowledge Map was grown up to 500 billion facts about 5 billion entities. But much of the “collective intelligence” Google tapped into was content “misappropriated by publishers,” the complaint alleges.

Other Google technologies, such as “Featured Snippets,” where Google algorithmically extracts answers from web pages, have also been cited as a way to direct traffic away from publishers’ websites.

Perhaps more important is the handling of the lawsuit over how AI will impact publishers’ businesses.

The problem has recently been detailed in a Thursday report by The Wall Street Journal, which led to a shocking statistic.

When online magazine The Atlantic modeled what would happen if Google integrated AI into its search results, it found that 75% of the time the AI ​​would answer the user’s search query without causing a click through to the website, causing lost traffic to go.

This could have a major impact on publishers’ traffic in the future, as Google accounts for almost 40% of their traffic today, data from Zekereweb shows.

Some publishers are now trying to get ahead of the problem. Axel Springer, for example, signed a deal this week with OpenAI to license its news for AI model training.

But overall, publishers think they will lose somewhere between 20 and 40% of their website traffic if Google’s AI products are fully rolled out, according to The WSJ report.

The lawsuit reiterates this concern, claiming that Google’s recent advances in AI-based search were implemented for the “purpose of discouraging end users from visiting the websites of Class Members who are part of the digital news and publishing industry.” ”

SGE, it argues, offers Internet searchers a way to find information in a conversational mode, but ultimately keeps users in Google’s “walled garden” because it “plagiarizes” their content.

Publishers also can’t block SGE because it uses the same web crawler as Google’s general search service, GoogleBot.

Additionally, it says that Google’s Bard AI was trained on a dataset that included “news, magazines, and digital publications,” with both a 2023 report of the News Media Alliance and an article from the Washington Post about AI training data as a reference.

(The Post, working with researchers at the Allen Institute for AI, found that news and media sites made up the third largest category of AI training data.)

The case also highlights other concerns, such as changing AdSense rates and evidence of improper plundering of evidence by Google, through the destruction of chat messages – an issue raised in the recent Epic Games lawsuit against Google over antitrust concerns in the app store, which Epic has addressed. won.

In addition to damages, the lawsuit asks for an injunction requiring Google to obtain permission from publishers to use their website data to train its general artificial intelligence products, including those of Google and those of rivals. Google is also asked to allow publishers who opt out of SGE to continue to appear in Google search results.

The American lawsuit follows an agreement Google reached with the Canadian government last month where the search giant would pay Canadian media for the use of their content.

Under the terms of the deal, Google will provide $73.5 million (C$100 million) each year to news organizations in the country, with the funds distributed based on the news outlets’ workforce.

Negotiations with Meta remain unresolved, although Meta began blocking news in Canada in August, in light of pressure to pay for content under Canada’s new law.

The case also coincides with the US filing Department of Justice lawsuit against Google for monopolizing digital advertising technologies, and references the Department of Justice’s 2020 civil antitrust lawsuit through search and search advertising (these are different markets than digital advertising technologies in the more recent example).

“The anticompetitive effects of Google’s plan are causing profound harm to competition, to consumers, to labor and to a democratic free press,” reads a statement announcement posted on the website of the law firm handling the case, Hausfeld.

“Plaintiff Helena World Chronicle, LLC relies on the Sherman Act and the Clayton Act to seek class-wide monetary and injunctive relief to restore and ensure competition for digital news and reference materials and to establish guardrails to ensure a free market of ideas in the new age of artificial intelligence,” it states.

Google has been asked for comment, but no comment has yet been provided.

The complaint can be found below.

Helena World Chronicle, LLC vs. Google LLC and Alphabet Inc 




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