The UK’s competition watchdog announced an investigation into Google’s dominance in the advertising market.
The Competitions and Markets Authority is currently investigating whether Google illegally preferred its services to those of its rivals.
This is the second active investigation of Google’s ad tech practices.
A representative from Google stated that they would continue to work with CMA to answer questions and share details about how their systems work.
They stated that advertising tools from Google and other competitors helped websites and apps finance their content and businesses of all sizes reach their customers effectively.
“Google’s tools have supported over 700,000. UK businesses with an estimated PS55bn of economic activity – and publishers can choose to use our advertising services to keep most of the revenue.”
The investigation will focus on the “adtech stack”, which services allow online advertising slots to buy and sell.
This has been divided into three sections. In each section, Google is the largest service provider.
CMA estimates that UK advertisers spent approximately PS1.8bn on online advertising in 2019.
Ioannis Kokkoris is a professor of competition law at Queen Mary University of London. He said that the CMA was concerned with Google’s packaging of services from these sections.
He stated that a company with a dominant market position cannot link together products it sells under standard competition law.
“It cannot impose any kind of exclusivity.
The CMA stated that Google is forcing advertisers to use its ad servers if they want to use their ad exchange.
It says that Google is preventing other players from entering these markets.
“If the CMA is able to prove the issue, then this conduct is anticompetitive.
“It all comes down to whether or not the CMA has the evidence to prove it.”
Andrea Coscelli, chief executive of CMA, stated that Google could be using its position as an ad tech company to favor its own services at the expense of its competitors, customers, and ultimately consumers.
“It is vital that we continue to monitor the behavior of tech firms that loom large over us and ensure the best outcomes in the UK for people and businesses.”
The CMA could launch an investigation under the 1998 Competition Act if Google is found to be in violation of competition law.
If further investigation uncovers a violation of the law, it may impose a penalty of up to 10% of Google’s worldwide turnover.
