Update, June 22 (10:45 am ET): European Commission opens investigation into Google's online adtech business.
What you need to know
- EU antitrust regulators could initiate a probe into Google's ad practices later this year.
- The probe will reportedly focus on Google's position in relation to advertisers, publishers, intermediaries, and major rivals.
- The EU has already fined Google more than 8 billion euros ($9.8 billion) for engaging in 'anti-competitive practices'
The European Union is set to launch a formal investigation into Google's adtech business before the end of the year, according to a report from Reuters. EU regulators have fined Google more than 8 billion euros ($9.8 billion) in the last three years for stifling competition in online shopping and digital advertising. In 2018, the EU slapped Google with a record-breaking €4.3 billion ($5 billion) fine for abusing its Android market dominance and requiring manufacturers to pre-install its Search and Chrome browser app on the best Android phones.
As per a person familiar with the matter, the probe would focus on "Google's position vis-à-vis advertisers, publishers, intermediaries and rivals." EU regulators are likely to conduct a much deeper investigation of Google's ad practices than the antitrust case concluded by French authorities earlier this month.
France's competition watchdog fined Google €220 million ($267 million) for abusing its dominance in the online advertising market. Google's advertising business is also under fire in the U.S. The Justice Department filed an antitrust lawsuit against the search giant in October last year for unlawfully maintaining a monopoly in the search text advertising market in the U.S.
Google's rivals and some advertisers claim the company "takes advantage" of the dependence that buyers and sellers have on it to extract high fees and make it nearly impossible for rivals to compete with it. Data from Market researcher eMarketer suggests Google could control roughly 27% of the global online ad spending in 2021.
The EU sent out a 13-page questionnaire to advertisers in January, seeking information on the impact of the default "Include Google Display Network" setting that the search giant introduced for search campaigns on Google Ads in 2018. Advertisers were also asked if they received rebates when using Google intermediaries to buy advertising inventory.
Update, June 22 (10:45am ET) ― EU begins investigating Google's ad business over 'possible anticompetitive conduct'
The European Commission today announced that it has opened a formal antitrust investigation into Google's adtech business to assess whether it has violated EU competition rules by favoring its in-house digital advertising services. The commission's investigation will also assess whether the search giant has been distorting competition in the digital advertising market by restricting third-party access to user data for advertising purposes.
European Commission's Executive Vice President, Margrethe Vestager, said in a statement:
Online advertising services are at the heart of how Google and publishers monetise their online services. Google collects data to be used for targeted advertising purposes, it sells advertising space and also acts as an online advertising intermediary. So Google is present at almost all levels of the supply chain for online display advertising. We are concerned that Google has made it harder for rival online advertising services to compete in the so-called ad tech stack.