EU opens investigation of Google ad tech

The European Commission said on Tuesday it has opened a formal antitrust investigation to assess whether Google has violated EU competition rules by favouring its own online display advertising technology services in the ad tech supply chain, to the detriment of competing providers of advertising technology services, advertisers and online publishers.

“The formal investigation will notably examine whether Google is distorting competition by restricting access by third parties to user data for advertising purposes on websites and apps, while reserving such data for its own use,” said the EC.

Commission executive vice-president Margrethe Vestager, in charge of competition policy, said: “Online advertising services are at the heart of how Google and publishers monetise their online services.

“Google collects data to be used for targeted advertising purposes, it sells advertising space and also acts as an online advertising intermediary.

“So Google is present at almost all levels of the supply chain for online display advertising.

“We are concerned that Google has made it harder for rival online advertising services to compete in the so-called ad tech stack.

“A level playing field is of the essence for everyone in the supply chain.

“Fair competition is important — both for advertisers to reach consumers on publishers’ sites and for publishers to sell their space to advertisers, to generate revenues and funding for content.

“We will also be looking at Google’s policies on user tracking to make sure they are in line with fair competition.”

Google said: “We will continue to engage constructively with the European Commission to answer their questions and demonstrate the benefits of our products to European businesses and consumers.”

Google, owned by Alphabet, added: “Thousands of European businesses use our advertising products to reach new customers and fund their websites every single day.

“They choose them because they’re competitive and effective.”

The Commission said many publishers rely on online display advertising to fund free online content for consumers.

“In 2019, display advertising spending in the EU was estimated to be approximately €20 billion,” said the Commission.

“Google provides several advertising technology services that intermediate between advertisers and publishers in order to display ads on web sites or mobile apps.

“The Commission’s investigation will focus on display advertising where Google offers a number of services both to advertisers and publishers.”

The Commission said it will in particular examine:

  • The obligation to use Google’s services Display & Video 360 (DV360) and/or Google Ads to purchase online display advertisements on YouTube.
  • The obligation to use Google Ad Manager to serve online display advertisements on YouTube, and potential restrictions placed by Google on the way in which services competing with Google Ad Manager are able to serve online display advertisements on YouTube.
  • The apparent favouring of Google’s ad exchange “AdX” by DV360 and/or Google Ads and the potential favouring of DV360 and/or Google Ads by AdX.
  • The restrictions placed by Google on the ability of third parties, such as advertisers, publishers or competing online display advertising intermediaries, to access data about user identity or user behaviour which is available to Google’s own advertising intermediation services, including the Doubleclick ID.
  • Google’s announced plans to prohibit the placement of third party cookies on Chrome and replace them with the “Privacy Sandbox” set of tools, including the effects on online display advertising and online display advertising intermediation markets.
  • Google’s announced plans to stop making the advertising identifier available to third parties on Android smart mobile devices when a user opts out of personalised advertising, and the effects on online display advertising and online display advertising intermediation markets.

About the Author

Mark McSherry
Dalriada Media LLC sites are edited by veteran news journalist Mark McSherry, a former staff editor and reporter with Reuters, Bloomberg and major newspapers including the South China Morning Post, London's Sunday Times and The Scotsman. McSherry's journalism has also appeared in The Washington Post, The Guardian, The Independent, The New York Times, London's Evening Standard and Forbes. McSherry is also a professor of journalism and communication arts in universities and colleges in New York City. Scottish-born McSherry has an MBA from the University of Edinburgh and a Certificate in Global Affairs from New York University.