Google is abusing dominance over online ads: UK competition watchdog
UK's antitrust watchdog, the Competition and Markets Authority (CMA), has accused Google of exploiting its dominant position in the digital advertising sector. The CMA alleges that the tech giant is engaging in anti-competitive practices, particularly favoring its own ad exchange over others. This behavior could potentially harm numerous British advertisers and publishers, according to the regulatory body.
Interim executive director of enforcement comments on Google's practices
Juliette Enser, the CMA's interim executive director of enforcement, stated that Google is using its market power to hinder competition in website advertising. She emphasized the importance of online advertising for many businesses, noting that it helps keep digital content free or cheaper and reaches millions across the UK. The CMA has been investigating these allegations since May 2022 and recently issued a formal statement outlining its provisional findings.
Google refutes CMA's allegations, defends its advertising technology tools
In response to the CMA's allegations, Google has expressed disagreement and plans to respond accordingly. Dan Taylor, Google's VP of Global Ads, defended the company's advertising technology tools. He stated that these tools help websites and apps fund their content while enabling businesses of all sizes to effectively reach new customers. Taylor further argued that the core of this case rests on flawed interpretations of the ad tech sector.
Google's ad tech business under scrutiny by US, EU regulators
The CMA's allegations against Google come as the company faces similar scrutiny from US Department of Justice and European Commission. In June 2023, EU regulators suggested Google might need to divest part of its ad tech business to address their concerns. However, Google deemed such a move "disproportionate." The CMA has also claimed that since at least 2015, the tech giant has been abusing its dominance on both sides of the advertising supply chain to favor AdX in matching auctions.
CMA to consider Google's response before deciding on action
The CMA has stated that it'll consider Google's response before deciding on any further action. The regulator has expressed concerns about AdX, where Google charges its highest fees in the ad-tech stack (approximately 20% of the bid amount). It believes that Google may have given AdX an unfair advantage through self-preferencing tactics. The CMA is now considering what measures may be necessary to ensure that Google ceases these anti-competitive practices and does not engage in similar practices.
