EU accuses Google of favoring its own ad-tech services

The European Commission today formally accused the technology multinational Google of abusing its dominant position by favoring its advertising technology or ‘adtech’ services, which are tools and programs used by advertisers to reach broader audiences and measure the impact of their campaigns.

The Community Executive announced an investigation in this regard in June 2021 and today sent a statement of charges to the US company in which it accuses it of “favor online display of their own ad technology services over rival providers”.

Brussels also believes that it is “unlikely” that a change in Google’s conduct in this sector can resolve the infringement of community competition rules, since the company is active in all segments of the sector, and pointed to the sale of part of its business as the only solution.

This is the fourth case in Brussels against Google after accusations of a dominant position through the Android system, its Google Shopping price comparison service and its Adsense for Search platform, which resulted in fines that together amount to about 8,000 millions of euros.

Regarding the new matter, the European Commission highlighted that online advertising is “the main source of income” from Google, either by directly selling space on their own web pages or applications or by acting as an intermediary between advertisers and owners of web pages that offer advertising space.

Specifically, the multinational offers services in this sector with two purchasing tools for advertisers (Google Ads and DV 360), another for publishers to manage their advertising spaces (DoubleClick for Publishers or DFP) and a platform that connects both parts of the business, AdX.

In this way, the Community Executive concluded that Google maintains a dominant position in these advertising technology markets within the European Economic Area (EEA) thanks to Google Ads, DV 360 and DFP.

“There is nothing wrong with being dominant in and of itself, but our research nevertheless shows that Google appears to have abused its market position by ensuring that its brokerage tools favor AdX.”, explained the vice-president of the European Commission responsible for Competition and the Digital Agenda, Margrethe Vestager, at a press conference.

Brussels suspects, in particular, that Google deliberately favored its AdX platform in the ad auctions organized by DFP by informing it, for example, of the value of the highest bid that a competitor had made and that it had to beat to win the contract. .

AdX also enjoyed a competitive advantage, according to the preliminary conclusions of the community authorities, in the purchasing tools Google Ads and DV 360: the former mainly offered offers made on the Google platform, causing AdX to be the option “more attractive”.

In addition, the European Commission considers that a change in this behavior “is likely to be ineffective” to prevent Google from continuing to favor its own tools, since the multinational is active in both parts of the market and its services are dominant in both.

Consequently, the preliminary opinion of the Community Executive is that the only way for Google to resolve the accusation of abuse of a dominant position is to sell “part of your services”.

Although the European Commission emphasized that sending the statement of objections does not prejudge the final result of the investigation, it also recalled that it can impose a fine of up to 10% of its global annual revenue on Google if it proves the infringements and the multinational persists in its conduct.

After hearing the news of the submission of the statement of objections, Google stressed that the investigation “is not new” and “focuses on a limited aspect” of its advertising business, while expressing its disagreement with the preliminary conclusions of the community authorities.

“We do not agree with the opinion of the EC and will respond accordingly”, said in a statement the vice president of Global Ads (Google), Dan Taylor, who also valued that the advertising technology tools of the multinational “help websites and apps finance their content and enable businesses of all sizes to effectively reach new customers”.

“Google remains committed to creating value for our publisher and advertiser partners in this highly competitive industry,” he stressed.

Source: EFE