Picture: REUTERS/SHANNON STAPLETON
Picture: REUTERS/SHANNON STAPLETON

Brussels — Google faces a sweeping EU investigation into its advertising technology, barely two years after regulators shut down almost a decade of investigations.

The European Commission said its case would assess whether the search giant breaches competition rules by favouring its own online display advertising technologies over rivals, according to a statement on Tuesday.

The investigation will also check if Google unfairly blocks rivals’ access to user data and scrutinise privacy changes that will phase out some cookies and data access for advertisers.

“We are concerned that Google has made it harder for rival online advertising services to compete,” Margrethe Vestager, the EU’s antitrust chief, said in the statement. “Online advertising services are at the heart of how Google and publishers monetise their online services.”

It’s the first time the EU has directly probed the black-box of online advertising where Google automatically calculates and offers ad space and prices to advertisers and publishers as a user clicks on a web page. Earlier EU probes focused on shopping search ads, mobile phone ads and advertising contracts.

Business ‘benefits’

Google 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,” it said in a statement.

“Thousands of European businesses use our advertising products to reach new customers and fund their websites every single day,” the company said. “They choose them because they’re competitive and effective.”

Digital advertising spending was about €20bn in the EU in 2019, the regulator said. EU fines are based on the value of sales and capped at 10% of yearly revenue. Google has previously been fined more than $9bn by the EU.

The EU probe will cover several parts of Google’s advertising business:

  • The requirement to use Google’s services Display & Video 360 — or DV360 — or Google Ads to buy display ads on YouTube
  • The requirement to use Google Ad Manager to serve online display ads on YouTube and potential curbs on how rival services can show ads on YouTube
  • The “apparent favouring” of Google’s ad exchange AdX by DV360 and Google Ads and the reverse
  • Restrictions on advertisers or publishers to see data about user identity or behaviour. That information can be viewed by Google’s own ad intermediation services, including DoubleClick ID
  • Google’s plans to phase out third-party cookies on Chrome and replace them with its Privacy Sandbox initiative
  • Google’s plans to stop access to the advertising identifier on Android devices when a user opts out of personalised ads

Bloomberg. More stories like this are available on bloomberg.com

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