Revelations about Google's secretive "Project Bernanke" that allegedly gave
its ad-buying system an advantage over rivals
are worrisome for publishers never told about it. The program has generated hundreds of millions of dollars a year for the company, possibly at the
expense of publishers that sell ad inventory in open bidding.
It's still too early to draw a conclusion about Project Bernanke, based on what Google accidentally revealed in its response
to a Texas antitrust lawsuit. However, the existence of the program should give publishers more reason to demand greater transparency from Google.
The original complaint filed
by Texas Attorney General Ken Paxton on behalf of 14 states was blacked out to hide the name "Project Bernanke," though its description as "yet another program to exclude competition" that was
"designed so that it is not transparent to publishers" was visible.
In its response to the complaint, Google formatted its answer in a way that revealed allegations previously
hidden from view. This mistake led Matt Stoller
, a critic of the country's lax antitrust enforcement and big-tech
monopolists, to mock Google for overspending on fancy lawyers who make avoidable clerical errors.
Other than the details that Google's program was called "Project Bernanke," that it
made $230 million in 2013, and that publishers weren't notified of it, the unredacted filing didn't reveal much else that wasn't already visible.
The Texas suit
includes an illustration of Project Bernanke at work,
claiming an advertiser using Google Ads to bid for a $10 CPM in USA Today's
website would unfairly win an auction against another advertiser that offered to pay a $12 CPM after the bids were
routed to Google's ad exchange -- effectively depriving the publisher from higher revenue.
With Project Bernanke, "Google will extract both its exchange fee and a second
ad-buying tool fee," according to the complaint. It also says Google's internal documents show that before it introduced the program, advertisers bidding through rival ad-buying tools were beating
marketers that used Google's software.
“Google's idea with [redacted] was to trade on inside information to help Google reverse this trend," the suit says. "The program
permitted Google to radically influence the amount of trading executed through Google Ads and in Google's exchange.”
Google has said the Texas complaint misrepresents
its business, and it plans to press its case in court.
What's less clear is how much revenue publishers possibly lost because of Project Bernanke. It's possible the effect was
muted, considering that many publishers have a variety of other options, such as preferred deals, programmatic guaranteed and private exchange to establish a price. Open auction should be a last
resort for remnant inventory, and even then, publishers need to protect themselves from shady marketers hawking poor-quality products.
Until more details emerge from the
antitrust case, wary publishers are right to insist that Google be more open about how its ad exchanges work.