The Competition and Markets Authority (CMA) is surveying whether Google’s role in the ad tech industry might be twisting a competition. This is the second major antitrust probe focusing on Google’s ad practices in the U.K.
The CMA maintains that powers should investigate anti competitive behavior from tech giants all the more intently under a new administrative body.
The U.K’s. competition controller has opened a new investigation into Google, focusing on the organization’s role in the ad tech market.
CMA launched a different investigation with the European Union into Google and Facebook parent organization Meta recently over worries that a 2018 settlement between the two organizations — known as “Jedi Blue” — limited competition in digital advertising.
The CMA said it was evaluating whether Google’s role in the ad tech industry might be contorting competition. The web giant is a predominant player in the web-based ad market.
Google goes about as both a demand side platform, which offers publishers’ ad inventory to advertisers, and an ad exchange, which allows advertisers to seek for advertising space on publishers’ sites, the CMA said. It likewise runs ad servers which deal with publishers’ inventory.
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Regulators are concerned Google may have illegally favored its own ad exchange services to the detriment of rivals. The CMA is also worried Google limited the compatibility of its ad exchange with third-party ad servers to make it harder for competing ad servers to compete.
According to Andrea Coscelli, the CMA’s chief executive, weakening competition in this area could reduce the ad revenues of publishers, who may be forced to compromise the quality of their content to cut costs or put their content behind paywalls.
“It may also be raising costs for advertisers which are passed on through higher prices for advertised goods and services”, Andrea Coscelli said.
It comes after an earlier competition probe from both the U.K. and EU into “Jedi Blue.” The deal allegedly involved Google and Meta rigging auctions for online ads and illegally fixing prices.
The CMA wants more powers to scrutinize anti-competitive behavior from tech giants under a new regulatory body called the Digital Markets Unit. The new controller, proposed in 2020, would have the ability to force fines of up to 10% of tech companies’ global annual revenues for breaching new digital rules. However, the government has yet to give the watchdog powers to impose these fines.
