This time, Google is facing another legal challenge from the European Union (EU), which has accused the tech giant of violating antitrust laws about its advertising business.
The EU’s main concern is that Google is dominant in the online advertising technology sector, acting as both a buyer and seller on its platform. This gives Google an unfair advantage and goes against the principles of fair competition outlined in the EU’s antitrust laws. Read more.
According to BBC, the EU Commission Executive Vice-President in charge of competition policy, Google’s extensive presence in the ad tech supply chain, where it collects user data, sells advertising space and serves as an online advertising intermediary, raises concerns.
The EU believes that Google used its market position to prioritize its intermediation services, potentially harming competitors and publishers and increasing advertising costs. If proven, these practices would be deemed illegal under EU competition rules.
It is worth noting that Google and its parent company, Alphabet, have previously faced antitrust violations related to their search engine and Android mobile operating system.
However, the current charges brought by the US Department of Justice and the EU specifically target Google’s advertising business, which generated a significant portion of the company’s nearly $60 billion in profit last year.
In addition to potential structural changes to Google’s ad business, the EU also has the authority to impose a fine of up to 10% of Alphabet’s annual global turnover.
Google now has the opportunity to defend itself against the allegations made by the European Commission. The company’s vice president of global ads, Dan Taylor, stated that Google’s advertising technology tools are essential for websites, apps, and businesses of all sizes to generate revenue and reach customers effectively.
Google asserts its commitment to creating value for its publisher and advertiser partners in what it acknowledges as a highly competitive sector.