3 ms·

This article explains it somewhat [1]. Still not much more detail, but more nuance than the Reuters piece. I guess the claim was that they manipulated where bi

by vrc 5y ago

This article explains it somewhat [1]. Still not much more detail, but more nuance than the Reuters piece. I guess the claim was that they manipulated where bids were placed based on who had the highest bid. So that if a non Google advertiser was going to win the auction, they removed the second highest bid if it was a Google advertiser s.t. the price paid for the slot dropped (second price auction). So in effect, they maintained a higher payout for pubs when Google programmatic bidders won by dropping the second price floor on non Google-programmatic winners. Thus making more money AND converting people towards programmatic. I believe their counter argument is that the data they had actually just made programmatic better from the start by predicting these outcomes, no fraud needed [1] https://www.wsj.com/articles/googles-secret-project-bernanke-revealed-in-texas-antitrust-case-11618097760 https://www.wsj.com/articles/googles-secret-project-bernanke...

zulban 5y ago
I think you may have missed the mark on "explain like I'm five".
- waterloosong 5y ago
  Who wouldn't. This is a second price auction that we speak of. Every ad company is polled to send no more than two bids. Naturally those would be the two highest bids from thousands that they handle. So let's say that Google first and second bids are G1 and G2, Facebook F1, and F2, some other company C1 and C2 and so on. So if those bids are sorted in descending order it may look like, for example, A1 > B1 > A2 > C1 > B2 > C2 > ... In this example, the ad belonging to A1 gets served, the price is the value of bid B1. That's why it is called "second price" auction. If it was a first price auction, the A1 advertiser would pay A1 bid price, and could save some money by bidding slightly lower, but still more than B1. Neither of these companies know up-front what the other bid will be, but with a second price auction there is no need for it, the A1 advertiser pays the amount of B1 bid. Same goes for bids G1 and G2, they don't know what other bids will be. It could end up like this: G1 > G2 > C1 > ... From time to time Google overhauls their AI. Let's say for simplicity that the two highest bids from Google are the same ads, the new bid for G1 is G'1 and the new bid for G2 is G'2. Though it could change who wins the auction, for instance if it ends up like this G'2 > G'1 > C1 > ... or C1 > G'1 > G'2 > ... Or it could change only what the price is, for example if it ends up like this, the price will lower from G2 to C1 G'1 > C1 > G'2 > ... Or if there is some minimum bid value Z required by publisher and it it would be G'1 > C1 > Z > G'2, it would be only G'1 that is passed to the auction. "Google allegedly dropped the second-highest bids from publishers' auctions". The "inflate only the bids belonging advertisers who used the company's Google Ads" is a mixture of G'1 > G'2 > G2 > ... and G'1 > C1 > G1 > ... and that sort of stuff There is no accumulating money in a pool, keeping it to spending later on something; there is a need for balancing the two effects above, so that the overhaul won't go overboard either way. The case of C1 > G'1 > G1 > ... is missing from the Reuters snippet. If it is in the lawsuit, it would end up as "secretly forcing the advertisers who used competing ad network to pay more", I guess

by vrc 5y ago

zulban 5y ago

I think you may have missed the mark on "explain like I'm five".

waterloosong 5y ago
Who wouldn't. This is a second price auction that we speak of. Every ad company is polled to send no more than two bids. Naturally those would be the two highest bids from thousands that they handle. So let's say that Google first and second bids are G1 and G2, Facebook F1, and F2, some other company C1 and C2 and so on. So if those bids are sorted in descending order it may look like, for example, A1 > B1 > A2 > C1 > B2 > C2 > ... In this example, the ad belonging to A1 gets served, the price is the value of bid B1. That's why it is called "second price" auction. If it was a first price auction, the A1 advertiser would pay A1 bid price, and could save some money by bidding slightly lower, but still more than B1. Neither of these companies know up-front what the other bid will be, but with a second price auction there is no need for it, the A1 advertiser pays the amount of B1 bid. Same goes for bids G1 and G2, they don't know what other bids will be. It could end up like this: G1 > G2 > C1 > ... From time to time Google overhauls their AI. Let's say for simplicity that the two highest bids from Google are the same ads, the new bid for G1 is G'1 and the new bid for G2 is G'2. Though it could change who wins the auction, for instance if it ends up like this G'2 > G'1 > C1 > ... or C1 > G'1 > G'2 > ... Or it could change only what the price is, for example if it ends up like this, the price will lower from G2 to C1 G'1 > C1 > G'2 > ... Or if there is some minimum bid value Z required by publisher and it it would be G'1 > C1 > Z > G'2, it would be only G'1 that is passed to the auction. "Google allegedly dropped the second-highest bids from publishers' auctions". The "inflate only the bids belonging advertisers who used the company's Google Ads" is a mixture of G'1 > G'2 > G2 > ... and G'1 > C1 > G1 > ... and that sort of stuff There is no accumulating money in a pool, keeping it to spending later on something; there is a need for balancing the two effects above, so that the overhaul won't go overboard either way. The case of C1 > G'1 > G1 > ... is missing from the Reuters snippet. If it is in the lawsuit, it would end up as "secretly forcing the advertisers who used competing ad network to pay more", I guess