European Union regulators have attacked Google over alleged antitrust violations over its advertising business, which could lead to a company split, the commission said in a statement.
European Commission (EC) issued a statement A preliminary discovery was made on Wednesday, alleging that Google violated antitrust laws in the advertising technology industry (adtech). Ad tech revenue accounted for his 79% of his total Google revenue in 2022. according to Reuters. The commission’s investigation into the tech giant has been going on for more than two years.
If the company is forced to sell part of its ad tech unit, Google could face major disruption to its future revenue model. According to Reuters, revenue streams such as search services, Gmail, Google Play, Google Maps, YouTube ads, Google Ad Manager, AdMob and AdSense will total $224.5 billion in 2022. (Related: Google suspends Chinese shopping app over security concerns
According to the EC statement, changes in Google’s behavior in this area “will not be effective in preventing the risk of Google continuing such self-imposed behavior or engaging in new behavior. It’s highly likely.” The alleged misconduct by Google “was intended to give AdX a competitive advantage and may have seized rival ad exchanges,” thereby making “Google’s AdX presence in the ad tech supply chain more difficult.” It will strengthen its central role and Google’s ability to charge high prices for its services.”
We object to Google’s favoritism of its online display ad technology services to the detriment of competing ad technology service providers, advertisers and online publishers.
Our tentative view is that Google may have violated EU antitrust rules by… pic.twitter.com/rhuTC4fU80
— European Commission (@EU_Commission) June 14, 2023
Reuters reports that the antitrust concerns are related to Google’s market dominance. The tech giant controls much of the world’s digital advertising, with a market share of 28% of global advertising revenue, the newspaper reported.
“Our preliminary concern is that Google may have used its market position to advance its intermediary services to its advantage,” EC Vice-President Margrethe Vestager said in a June 13 statement. It is.” Advertiser costs also increase. If confirmed, Google’s conduct would be unlawful under our competition rules. “
No charges have been filed in the investigation so far, but they could be. In a statement, the EC said of the consequences if a company is found to be in violation of the regulation: This practice will be prohibited and a fine of up to 10% of the company’s global annual turnover will be imposed. “
Reuters reported that Google attempted to settle the lawsuit about three months after the investigation began. report in another article. The mediation ultimately fell through due to lengthy negotiations and a lack of concessions on Google’s part, the Times said.
Dan Taylor, Google’s vice president of global advertising, said in a statement that the EC’s “research focuses on a narrow aspect of our advertising business and is not new.” We disagree with the EC’s position,” the paper reported.
