Google’s advertising business has been found to be in violation of antitrust laws, according to European regulators. This latest development adds to the ongoing competition challenges faced by the tech giant.
The European Commission’s initial review of Google has revealed that the company distorted competition in the advertising technology industry by allegedly favoring its display advertising technology services in a way that harms competing advertising technology services, advertisers, and online publishers.
The commission has alleged that Google gave preferential treatment to its ad exchange AdX in the ad selection auction run by its dominant ad server DFP. Google informed AdX in advance about the value of the best bid from competitors in order to win the auction. Additionally, Google avoided competing ad exchanges and made its own exchange the most attractive.
“Our preliminary concern is that Google may have utilized its market position to benefit its own intermediation services,” said Margrethe Vestager, executive vice president of the European Commission. “Not only may this have harmed Google’s competitors, but it also disregarded the interests of publishers and increased costs for advertisers. If proven, Google’s practices would be in violation of our competition rules.”
This allegation from the EU follows the lawsuit filed by the U.S. Department of Justice and several states against Google regarding its dominant position in the digital ad space. The U.K.’s competition regulator is also investigating Google’s anti-competitive conduct in the digital advertising market.
Google has responded to these claims in a blog post by Google’s vice president of global ads, Dan Taylor. Taylor stated that the claims in the European Commission’s Statement of Objections are not new and only relate to a small portion of Google’s advertising business. He emphasized that advanced advertising technology benefits merchants by helping them reach customers and grow their businesses, while also lowering costs and expanding choices for consumers.
Taylor added, “The digital advertising market is characterized by competitive pricing, thriving innovation, and robust competition, which benefit advertisers, publishers, and consumers. We are eager to demonstrate how our ad tech tools contribute to an open and accessible internet and how dismantling them would reduce the availability of free, ad-supported content that benefits everyone.”
It is important to note that Google has previously denied allegations of violating antitrust laws in the digital ad space in the United States.
Updated at 11:14 am.
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