Dreamstime has filed a sweeping lawsuit against Google in California federal court alleging anticompetitive and discriminatory antitrust law violations as well as on-going breaches of contract, in order to use its monopoly position in online search to benefit its business partners –
Shutterstock, and of late
Getty Images – while leaving other stock photo sellers out in the cold.
Dreamstime said its troubles started in the second half of 2015, when Google allegedly used its monopoly power in online search advertising to boost up Shutterstock while bumping down other stock photo sellers. In February 2018, Google struck a similar deal with Getty Images. According to the suit Dreamstime is expecting more alleged algorithm changes to occur, pushing it, and virtually all other stock image distributors, further into search result oblivion.
In its
82-page complaint Dreamstime claims that Google selectively enforces policies requiring advertisers to use more expensive forms of advertisement, meaning that some competitors are able to attract customers for less money than others. Google has also canceled, without warning, some of Dreamstime’s most effective advertising campaigns and suspended the stock photo company’s account for “policy violations” without sufficient explanation, according to Dreamstime.
Dreamstime said it has spent around $50 million on AdWords and DisplayAds for online advertising services, but that Google still favors Shutterstock when it comes to search results. (In 2017 alone Shutterstock spent $146 million in sales and marketing. A significant percent of that was certainly paid to Google, but Shutterstock does not provide a breakdown as to how much.)
According to the suit Google selectively enforces policies requiring advertisers to use more expensive forms of advertisement, meaning that some competitors are able to attract customers for less money than others. In addition, Google has canceled, without warning, some of Dreamstime’s most effective advertising campaigns and suspended the stock photo company’s account for “policy violations” without sufficient explanation, according to Dreamstime.
Dreamstime said that in or around August 2015 Google changes its search algorithm and Dreamstime’s search rankings plummeted from at or near the top of search results for online stock photographs to 91st (as much as 20 pages deep) – well below Shutterstock and Getty Images, well below other smaller competitors, and even well below unambiguously less relevant search results. Essentially, Dreamstime became invisible to people googling for online stock photographs.
According to the suit Google devastated Dreamstime’s business, cost it millions of dollars in sales and threatens its survival. Google’s alteration of its algorithm did not serve to benefit the consumer but was intended to increase its partners’ and its own businesses and to discriminate against and harm Dreamstime. Google has since replicated this monopoly conduct to exclude other similarly-situated competitors, including 123RF, DepositPhotos, and CanStockPhoto, who have all suffered inexplicable drops in online search rankings. The only significant stock photography competitor that has not announced a partnership with Google and that has not yet been excluded from top search results is Adobe.
In just one of its 13 causes of action outlined in the Introduction to the suit Dreamstime said: “Google has intentionally and aggressively interfered with Dreamstime’s AdWords and DisplayAds campaigns in several material ways. Among other things, Google has:
•manipulated Dreamstime’s organic search ranking unfairly and illegally to force Dreamstime to spend an unreasonable amount of money on additional AdWords campaigns that would not therwise have been necessary;
•cancelled Dreamstime’s most successful ad campaigns without adequate notice or explanation;
•improperly suspended Dreamstime’s account based on unfounded accusations of “policy violations;”
•prevented Dreamstime from running successful DisplayAds campaigns while allowing the exact same advertisements to be placed by other competitors;
• placed Dreamstime’s advertisements on irrelevant websites and error pages in direct violation of the AdWords contract; and
• overdelivered AdWords campaigns, causing daily spending limits for certain campaigns to be exceeded on a regular and systematic basis.
Dreamstime CEO Serban Enache said in the statement that the suit aims to level the playing field for stock photo sellers online. “The purpose and goal of our lawsuit is to eliminate unfair bias and favoritism from Google’s online search advertising services and to create a much-needed level playing field so online vendors can legitimately compete on the quality, selection and prices of their online services and products.”
Recently the European Union fined Google
€2.42 billion euros ($2.72 Billion) for breaching European anti-trust rules. It will interesting to see if the U.S. courts come to the same conclusion and whether either action results is fairer search practices.