Source: Business Today
Reports suggest that Alphabet Inc has reportedly offered to allow rival ad intermediaries to place ads on YouTube in order to address an important part of an EU antitrust probe. Crucially, addressing this aspect of the investigation could clear the path for the tech giant to settle the case without paying a fine. The details of this development were disclosed by sources essentially familiar with the matter.
Last year, the European Commission initiated a probe for the examination of whether Google was providing itself an unfair advantage in digital advertising. Mainly, by means of restriction of its rivals’ and advertisers’ access to user information. The EU competition watchdog singled out the requirement of the search giant that advertisers utilise its Ad Manager for the display of ads on YouTube. Along with it, the potential restriction in this path in which rivals serve advertisements on YouTube.
Moreover. it is also looking into requirement of world’s biggest provider of search and video that advertisers make use of its services Display & Video 360, along with Google Ads to purchase ads on YouTube. In the first quarter of 2022, YouTube posted $6.9 billion in sales.
Response to the developments:
Both, the European Commission, along with Alphabet Inc’s Google refused to comment on the situation. Previously, the search giant had stated publishers and advertisers frequently used multiple technologies and platforms for the selling of ads. Since last year itself, Google has been in discussion about remedies with the EU Commission in a bid to ward off a fine that could go as high as 10% of its global turnover.
However, the tech company would require to offer more than just the YouTube solution to address concerns to get hold of a deal. Sources familiar with issue specified this further stating that the discussion looked like their were on the right track. Additionally, CMA, the British competition agency is reportedly investigating the search giant’s practices.
In 2021, Alphabet Inc’s Google reportedly generated a revenue of $147 billion from online advertisements, clearly more than any other tech company all over. Essentially, with ads, it includes search, YouTube and Gmail accounting for the greater part of its overall profit and sales.
Moreover, the display or network business of Google accounted for around 16% of its entire revenue. This business is one which other media companies also use the search giant’s technology to sell ads on their apps or website.