EU antitrust authorities investigate extensive Google advertising activity

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(CNN) – The European Union has launched an antitrust investigation into Google’s vast advertising activity, saying the company may have put competing services at a disadvantage, making it harder for brands to reach consumers and for publishers to fund their content.

The formal investigation, which follows a preliminary investigation opened in 2019, will examine whether Google distorts competition by restricting access to user data for advertising purposes, while reserving that data for its own use, the Google said on Tuesday. European Commission.

“Google collects data to be used for targeted advertising purposes, it sells advertising space and also acts as an online advertising intermediary. Google is therefore present at almost every level of the supply chain for display advertising in line, “said Margrethe Vestager, EU antitrust officer. in a report.

“We are concerned that Google has made it more difficult for competing online advertising services to compete in the so-called advertising technology stack.”

A Google spokesperson said the company would engage constructively with the European Commission “to answer their questions and demonstrate the benefits of our products to European businesses and consumers.”

Google is already facing several antitrust cases in the United States, including one filed by the federal government, which accuses the company of exercising an illegal monopoly in the online search and search advertising markets.

The company derives about 80% of its revenue from advertising. In the three months ended March 31, Google’s revenues in Europe, the Middle East and Africa totaled $ 17 billion, making it the company’s second-largest region after the Americas.

Total display advertising spending in the European Union was around 20 billion euros ($ 24 billion) in 2019. It is a company dominated by Google and Facebook, which is already the subject of a investigating by EU regulators for allegations that its use of the data gives it an unfair advantage.

The French competition authority fined Google 220 million euros ($ 270 million) earlier this month “for abusing its dominant position” in the online advertising market to the detriment of platforms and competing publishers.

The authority accused Google of giving “preferential treatment” to Google Ad Manager, its ad management platform for large publishers. It did so by prioritizing its own online advertising marketplace, AdX, where publishers sell space to advertisers in real time, according to the watchdog.

Change your activity

As part of the agreement with the French authorities, Google has undertaken to facilitate the use of its data by publishers in France and the use of its tools with other advertising technologies. “We will be testing and developing these changes over the next few months before rolling them out more widely, including some globally,” the company said in a June 7 statement.

Google provides several ad technology services that mediate between advertisers and publishers to display ads on websites or mobile apps. The EU’s investigation will focus on a number of areas of concern, including the obligation to use its services to buy or serve ads on Google or YouTube.

“A level playing field is essential for everyone in the supply chain,” Vestager said.

“Fair competition is important – both for advertisers to reach consumers on publisher sites and for publishers to sell their space to advertisers, to generate revenue and funding for content. Google on tracking users to make sure they are in fair competition, ”she added.

According to Google, competition in online advertising has made ads more affordable, reduced ad technology costs, and created more options for publishers and advertisers. The company also claims that publishers keep around 70% of the revenue when using its products, and the biggest advertisers use four or more platforms to buy ads.

– Rob North, Eoin McSweeney and Hanna Ziady contributed to this article.

This story first appeared on CNN.com, “EU Antitrust Officials Investigate Extensive Google Advertising Activity.”

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