Advertisers reportedly dump Google and YouTube, worried about extremist videos

Major American brands, including AT&T and Verizon, are reportedly pulling advertising from Google and its YouTube division in response to a growing scandal over extremist videos hosted by the internet giant.

More than 250 organizations, including the British government, have already pulled advertising in Britain after a leading newspaper there published an investigation last week detailing how ordinary ads appear alongside YouTube videos that promote hate and extremism.

The report by Britain’s The Times showed how L’Oreal ads appeared next to videos by homophobic British preacher Steven Anderson and how government-funded ads for the Royal Navy and Scottish tourism appeared next to clips by white supremacist David Duke, an American who has been head of the Ku Klux Klan.

Google apologized Monday after pledging to police ads next to the offending videos in Britain, the company’s second-largest market.

The risk for Google – a subsidiary of Mountain View, Calif.-based Alphabet Inc. – is that the fallout could spread further, especially in the U.S., its largest market.

In addition to AT&T and Verizon, Enterprise Rent-A-Car pulled advertising from Google, The Times reported Wednesday.

The companies could not be immediately reached for comment.

The Times reported that Verizon suspended its digital advertising after it learned its ads appeared alongside videos by two Muslim clerics: Wagdy Ghoneim, an Egyptian who the U.S. government said participated in fundraising activities that could have helped terrorist organizations, and Hanif Qureshi, a Pakistani whose preaching reportedly inspired the assassination of a politician in that country.

“AT&T adverts were also placed on YouTube videos showcasing an Islamic State flag and another promoting the sermons of Anwar Al Awlaki, a senior Al Qaeda recruiter killed by a U.S. drone strike in 2011,” The Times reported.

The advertisers’ moves come as Google’s dominance in digital advertising is being increasingly challenged by Facebook Inc. and, to a lesser extent, by Snap Inc.’s Snapchat and by Verizon Communications Inc. Google commands about 40 percent of U.S. online ad sales.

Concerns over where ads appear online have persisted since the advent of digital advertising, but they now offer fresh leverage in pushing for greater concessions and increased options in deal talks with the search and video giant.