Google in EU’s sights with antitrust investigation into advertising
BRUSSELS, June 22 (Reuters) – Google was once again in the EU’s antitrust spotlight on Tuesday as regulators opened an investigation into whether its digital advertising business gives Alphabet Unit (GOOGL.O) an unfair advantage over rivals and advertisers.
The decision by the European Union’s competition authority marks a new front against Google and follows more than 8 billion euros ($ 9.5 billion) in fines over the past decade for having blocked competitors in online shopping, Android smartphones and online advertising.
The European Commission has said it will investigate whether Google distorts competition by restricting third-party access to user data for advertising purposes on websites and apps, while reserving that data for its own use.
“We are concerned that Google has made it more difficult for competing online advertising services to compete in the so-called ad technology stack,” EU Competition Commissioner Margrethe Vestager said in a statement.
Google generated $ 147 billion in revenue from online ads last year, more than any other company in the world, with ads like search, YouTube and Gmail accounting for the bulk of its sales and profits.
About 16% of its revenue came from the company’s display or network activities, in which other media companies use Google technology to sell advertisements on their website and apps.
“We will also review Google’s policies on user tracking to ensure they are in line with fair competition,” Vestager added.
Google has said it will engage constructively with the Commission.
“Thousands of European businesses use our advertising products to reach new customers and fund their websites every day. They choose them because they are competitive and efficient,” said a Google spokesperson.
The Commission said its investigation would cover Google services including Display & Video 360 (DV360) and Google Ads to buy online display ads on YouTube, Google Ad Manager which is used by publishers to auction ad space , and AdX which is one of the many marketplaces that can handle auctions.
Google’s plans to remove browser cookies and also stop tracking Android users through a tool known as an Advertising ID will also be examined.
Reuters exclusively reported last week that the European competition authority would investigate Google’s digital advertising activities before the end of the year.
Google’s adtech business is also under fire in the United States, with the Justice Department, joined by some states, suing last year for abusing its dominance in search ads. A Texas-led group of states in a subsequent lawsuit focused on anti-competitive behavior on the network side of the house.
A new EU investigation could end up targeting Google’s entire advertising empire. According to the eMarketer market research, Google could control 27% of global online ad spend this year, with 57% for search ads and 10% on display.
While the numbers may not seem like a monopoly at first glance, advertisers and rivals argue that Google’s various software plays a role in so many facets of the market that the company is impossible to avoid.
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Reporting by Foo Yun Chee
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