Google doesn’t only make some of thebest Android phones, it also dominates the online advertising space, which is where most of the company’s revenue comes from. Regulators around the world have seen issues with this unrivaled position, and now, the EU is looking to challenge the status quo. In a press release, the European Commission announced that it thinks Google has breached its antitrust rules, which may mean that the EU will force Google to sell part of its adtech business.
TheEuropean Commission saysthat Google is favoring “its own online display advertising technology services to the detriment of competing providers of advertising technology services, advertisers and online publishers.” This is possible because Google owns businesses in all relevant areas of the advertising space. The company operates both publisher ad servers and offers ad buying tools, and connects these two areas with its ad exchange AdX.
“Our preliminary concern is that Google may have used its market position to favour its own intermediation services,” said Margrethe Vestager, the European Commissioner for Competition. “Not only did this possibly harm Google’s competitors but also publishers’ interests, while also increasing advertisers’ costs. If confirmed, Google’s practices would be illegal under our competition rules.”
The European Commission thinks that this is a fundamental problem with the way Google’s advertising business is set up, so a behavioral change is unlikely. Instead, the EU recommends the company sells its ad selling tools, leaving this part of the market open to competitors.
In astatement to Reuters, Google’s vice president of global ads, Dan Taylor, said, “The Commission’s investigation focuses on a narrow aspect of our advertising business and is not new. We disagree with the EC’s view.” In a first step, the European Commission has confronted Google with its findings, giving the company time to reply and present its side of the story before moving forward.
The investigation was first opened two years ago, with Google offering objections from the get-go. The investigation could go on for a few more months or even years until a conclusion is reached, and only then it will be decided whether Google needs to break out parts of its ad business or if there will be another solution.
