Google faces scrutiny for allegedly abusing market power in digital ads
Britain’s antitrust regulator announced that it had provisionally found Alphabet’s (GOOGL.O) Google had abused its dominant position in digital advertising to restrict competition.
The Competition and Markets Authority (CMA) said it believed Google was using anti-competitive practices in open display ad tech through the preference of its own ad exchange, which could be harming thousands of British publishers and advertisers.
“We’ve provisionally found that Google is using its market power to hinder competition when it comes to the ads people see on websites,” said Juliette Enser, the CMA’s interim executive director of enforcement.
“Many businesses are able to keep their digital content free or cheaper by using online advertising to generate revenue. Adverts on these websites and apps reach millions of people across the UK – assisting the buying and selling of goods and services.”
Google said it disagreed with the CMA’s view and would respond accordingly.
“Our advertising technology tools help websites and apps fund their content, and enable businesses of all sizes to effectively reach new customers,” said Google’s VP of Global Ads Dan Taylor.
“Google remains committed to creating value for our publisher and advertiser partners in this highly competitive sector. The core of this case rests on flawed interpretations of the ad tech sector.”
The US Department of Justice and the European Commission are also investigating Google’s activities in ad tech.
In June 2023, EU regulators said Google may have to sell part of its adtech business to address its concerns. Google said in December that such a step would be “disproportionate”.
The CMA said it had provisionally found that since at least 2015 Google had been abusing its dominance on both the buying and selling sides of the advertising supply chain to favour its own ad exchange AdX in matching auctions.
The regulator can impose a fine of up to 10 per cent of a company’s global turnover, with the amount depending on the seriousness of the infringement. It can also issue legally binding directions to bring the infringement to an end.
Representations from Google will now be considered, the CMA said, before it reaches a decision on what action to take.