Wired: Google’s Alleged Scheme to Corner the Online Ad Market

I have mentioned this story before but I’m going to take the rare step of mentioning it again because this is a great explainer of what Google is accused of doing with its advertising auction. Wired: Google’s Alleged Scheme to Corner the Online Ad Market. “IN 2010, A Google product manager named Scott Spencer gave an interview explaining Google’s use of ‘second-price’ auctions to place ads across the web. In a second-price auction, the highest bidder wins, but only has to pay whatever the second highest bid was. Economists love this setup—the guy who theorized it won a Nobel Prize—because it encourages participants to bid whatever the item is truly worth to them without worrying about overpaying. As Spencer explained, ‘it minimizes the need to “game” the system.’ But what if Google was the one gaming the system?”

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