UK Probes Google Over Potential
Abuse of Ad Tech Dominance
May 27, 2022
The CMA is investigating whether Google has broken the law by restricting competition in the digital advertising technology market.
CMA launches second investigation into Google’s practices in ad tech, following launch of probe into Google and Meta’s ‘Jedi Blue’ agreement.
Advertising technology intermediation, also known as the ‘ad tech stack’, is a complex set of services which facilitate the sale of online advertising space between sellers (publishers, like online newspapers and other content providers) and buyers (advertisers). In 2019, UK advertisers spent around £1.8 billion on this kind of online advertising. The market is important because millions of people across the UK use websites that rely on advertising revenue to offer high-quality, free content.
Google has strong positions at various levels of the ad tech stack, charging fees to both publishers and advertisers.
The Competition and Markets Authority (CMA) is examining 3 key parts of this chain, in each of which Google owns the largest service provider:
The CMA is assessing whether Google’s practices in these parts of the ad tech stack may distort competition. These include whether Google limited the interoperability of its ad exchange with third-party publisher ad servers and/or contractually tied these services together, making it more difficult for rival ad servers to compete.
The CMA is also concerned that Google may have used its publisher ad server and its DSPs to illegally favour its own ad exchange services, while taking steps to exclude the services offered by rivals.
Andrea Coscelli, the CMA’s Chief Executive, said:
This case follows on from the CMA’s market study into online platforms and digital advertising which identified significant issues and made an assessment of possible solutions to address market power in ad tech. The CMA will consider these further in the course of its investigation. The CMA has subsequently opened a competition investigation into Google and Meta’s ‘Jedi Blue’ agreement in relation to header bidding services, which are a part of the wider ad tech stack. The CMA is also monitoring compliance with commitments Google made in relation to its Privacy Sandbox proposals to remove third-party cookies and other functionality from Google’s Chrome browser.
Until this legislation is in place, the CMA will forge ahead using its existing powers in the tech sector, including probes into Apple’s App Store, Meta’s use of data and Apple and Google’s mobile ecosystems over competition concerns.
The CMA maintains a joined-up approach across all related cases to ensure the best outcomes for people and businesses throughout the UK.
The European Commission (EC) has launched its own investigation into Google’s practices in the ad tech sector. Google practices are also the subject of a complaint by the State of Texas (and other US States) currently in the US courts. In July 2021, the French Autorité de la Concurrence closed a similar case against Google having imposed a fine and secured commitments.