Google under accusation by the EU antitrust risks the stew
On Wednesday, European Union regulators informed Google that it had "violated EU antitrust rules by distorting competition in the advertising technology sector". Regulators seek to dismantle the US tech multinational's advertising empire.
The European Commission, the European Union's antitrust regulator, said Google "abused its dominant position " in trading online ads on third-party apps and websites. A clear warning notice.
The Commission said that, in its preliminary opinion, Google must sell segments of its advertising business to resolve the "conflicts of interest inherent" in digital advertising. Too bad that, with the usual indecisive style, no mention has been made of what must be sold, leaving the usual space for the lobbying pressures of the IT giant. Regulators said Google "holds dominance" on "both sides of the market with its publisher ad server and with its ad buying tools."
“The Commission takes the preliminary view that, in this specific case, a behavioral remedy is likely to be ineffective in preventing the risk that Google will continue to engage in such self-preferential behaviors or engage in new ones. Google is active on both sides of the market with its publisher ad server and its ad buying tools and holds a dominant position on both fronts. Also, it operates the largest ad exchange. This leads to an inherent conflict of interest situation for Google. The Commission's preliminary view is therefore that only Google's mandatory divestment of a portion of its services could address its competition concerns ."
The EU announcement comes months after the US Department of Justice and eight states filed lawsuits over Google's advertising business, claiming it illegally monopolizes the market for online ads. This is the second antitrust lawsuit filed by US federal authorities against the company's advertising empire.
“For 15 years, Google has pursued an anticompetitive course that has allowed it to block the rise of rival technologies, to manipulate the mechanisms of the auctions, to insulate itself from the competition and to force advertisers and publishers to use its tools,” wrote Attorney General Merrick Garland in a January press release.
The outcome of those three cases could have far-reaching implications for Google's parent company Alphabet, which reported $60 billion in profits last year from advertising being exercised in this near-monopoly fashion.
“Google is therefore present at almost all levels of the so-called adtech supply chain. Our preliminary concern is that Google may have exploited its market position to favor its own brokerage services. This could harm not only Google's competitors, but also the interests of publishers, while increasing costs for advertisers. If confirmed, Google's practices would be illegal under our competition rules,” Margrethe Vestager, the European Commission executive vice president who oversees digital and competition policy, said in a statement.
Earlier in the week, The Wall Street Journal reported that the EU was considering ordering the breakup of Google's advertising business. With pressure on both sides of the Atlantic, the walls are closing in on Google's advertising business.
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The article Google under accusation by the EU antitrust risks the stew comes from Scenari Economici .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/google-sotto-accusa-dellantitrust-ue-rischia-lo-spezzatino/ on Thu, 15 Jun 2023 08:00:52 +0000.