On Wednesday, Brussels had accused search engine giant Google of exploiting its dominant position in the advertising tech sector, and has threatened that the charges can only be resolved if the behemoth agrees to sell of part of its business. For the first time, such a move has been demanded by the european commission – the break up of a big tech company, post-years of anti-trust enforcement, in which Google has been levied fines worth billions of euros.
The Commission, which is also the European Union prime enforcer, accused Google of exploiting its monopoly in providing services for both publishers as well as advertisers in order to get an unfair advantage on its own advertisement marketplace. The commission also added that “only the mandatory divestment by Google of part of its services would address“ the issue.
The tech giant has been given deadline until September to respond to the preliminary charges, however, the company has denied to the commission‘s proposal and has said it would reciprocate accordingly.
The accusations in fact only a small part of googles business – advertising, that is, newspaper ads, banners – which do not even appear on search results pages. But the charges levied signify a new approach by the European Union regulators. Not just the EU but also the United States is stepping up action against the search engine giant and the commission underlined what it said was “very strong transatlantic cooperation“ in the case.
The EU‘s executive vice president in charge of competition policy, Margarethe Vestager Said, “Google is representing the interest of both buyers and sellers – at the same time. Google is setting the rules on how demand and supply should meet. This gives rise to inherent and pervasive conflicts of interest.”
Furthermore, she stated that the Silicon Valley giant could be coerced to divest its publisher ad server, DoubleClick for Publishers, and it’s advertisement exchange- AdX. Add server is unable publishers like websites and applications to manage automated advertising, whereas ad buying tools – another part of the market where Google holds monopoly – assist advertisers in targeting customers.
Google play a significant role in each step of the process for buying and selling advertising on the open Internet, which allows it seamless advantages on pricing for services determined in ad exchanges that link publishers and advertisers.
and in order to be more specific, the anti-trust commission recounted that since at least 2014, Google has been partial in placing bids with its own exchange.
The anti-trust vice president mentioned that in some cases AdX had the authority to make a bid after all other bidders had made stairs, whereas in others, AdX was notified in advance of the value of the best bid from rivals.
Image source: Google
The commission also stated that the company’s conducts “may have foreclosed rival ad exchanges” and had given it an opportunity to charge higher prices.
dating back to an investigation from June 2021 when the commission said that it was concerned that Google was making it difficult for its rivals to compete in the online advertising market. In January this year, The US Justice Department announced similar allegations directed towards Google claiming that the company had embarked on a “systematic campaign“ in order to gain monopoly and control over the digital ad tech market. The department, like the EU commission, also underlined what it felt was the tech giants “pervasive conflicts of interest”.
Dan Taylor, Google’s vice president of global ads said in a statement, “or advertising technology tools helps websites and apps fund Their contents, 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 sector. The commission’s investigation focuses on a narrow aspect of our advertising business and is not new.”
