Google was accused on Wednesday of violating European Union antitrust laws by using its dominance in online advertising to undermine rivals, the latest in a series of cases around the world that go to the heart of the internet giant’s business model.
The case was brought by the European Commission, the executive branch of the 27-country European Union, and is the fourth time Google has been charged with violating European antitrust laws in recent years. In this case, the European Union accused Google of abusing its control over the market for buying and selling online advertising.
The US Justice Department filed similar charges against Google in January, accusing the company of illegally abusing a monopoly over the technology that powers online advertising. The UK Antitrust Authority has also investigated Google’s advertising practices.
The outcomes of the cases could have significant implications for Google’s parent company, Alphabet, which drew most of its $60 billion in profits from advertising last year. Ads support nearly all of Google’s popular services, including search, email, maps, and Android, and allow the company to offer them for free.
“Google is present at almost all levels of the so-called adtech supply chain,” Margrethe Vestager, the European Commission’s executive vice president, said in a statement. “Our first concern is that Google has used its market position to favor its own brokerage services.”
“This may have harmed not only Google’s competitors, but also the publishers’ interests, while increasing costs for advertisers,” added Ms Vestager, who oversees digital and competition policy.
The new charges against Google are part of a long-running effort by European authorities to crack down on the world’s largest technology companies. Apple and Meta, which own Facebook and Instagram, are also the subject of antitrust investigations. Last year, the European Union passed new antitrust and digital services laws to tighten scrutiny of the biggest tech companies. And on Wednesday, the European Parliament, a legislative arm of the European Union, approved a bill regulating artificial intelligence.
In recent years, European authorities have fined Google billions of dollars for what they say are antitrust violations related to its Android mobile operating system, its shopping service, and some other part of its advertising business. All cases remain tied up in court after legal appeals by Google.
With the new charges, the European Commission unveiled what’s known as a “statement of objections” to Google, outlining why it believes the company has breached antitrust laws. It’s one step in what could be a lengthy process before final decisions are made about imposing a fine of up to 10 percent of Google’s global revenue or ordering other changes to its business practices. A settlement could also be reached.
Google said it disagreed with the regulators’ findings and would “respond accordingly”.
“Our advertising technology tools help websites and apps fund their content and enable businesses of all sizes to effectively reach new customers,” said Dan Taylor, Google’s vice president of global advertising. “Google remains committed to creating value for our publisher and advertiser partners in this highly competitive industry. The committee’s investigation focuses on a narrow aspect of our advertising activities and is not new.”
European regulators began an investigation into Google two years ago, focusing on the display advertising market, which includes banners and other visual formats on websites. Google offers a number of services to advertisers and publishers in this industry. It collects data to target advertising, sell advertising space on websites, and offer products that serve as an intermediary between advertisers and publishers who own websites.
By controlling such a large part of the online advertising supply chain, according to Vestager, Google has made it harder for rivals to compete. Publishers like News Corp. have long complained that Google’s dominance limits the amount of money they can generate from advertising on their websites or for competing services to emerge.
The European Publishers Council, an industry group representing media companies, applauded Wednesday’s action. The group said it filed a complaint more than a year ago that described how Google “used their position to the detriment of publishers.”
“We look forward to working with the committee as the matter continues,” said the council’s executive director, Angela Mills Wade.
