Google has agreed to pay a 220 million Euros ($268 Million) fine to settle an investigation by France’s antitrust authority over the company’s abuse of power in online advertising. The US tech giant has also agreed to make changes to its online advertising services.
The investigation came after US-based News Corp. French newspaper Le Figaro and the Belgian Press Group Rossel filed a complaint against Google.
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The French Competition Authority found that Google favored the company’s online ad marketplace. Google Ad Manager provided Google AdX with data such as the winning bidding prices, while AdX also enjoyed privileged access to requests made by the advertisers via Google’s ad services.
Digital advertising creates powerful opportunities to tell brand stories at scale and in context. Through ads on various devices and channels, marketers can reach larger audiences in a way that is real-time and increasingly personal. Advertising platforms serve as the broker or intermediary between the digital publisher and the advertiser.
Advertising platforms such as Google Ad Manager are therefore crucial for publishers to manage and sell advertising space. But such favoritism by Google deprives publishers of potential industry competition.
The French Competition Authority said Google had unfairly sent business to its services and discriminated against the competition. As a result of which Google’s publishers and rivals suffered.
Isabelle de Silva, President of the French Competition Authority said in a statement that the investigation revealed processes by which Google favored itself over its competitors on advertising servers and supply-side platforms which are pieces of software used by publishers to manage, sell, and optimize ad space on their websites and mobile apps.
“These very serious practices have penalized competition in the emerging online advertising market and have enabled Google not only to preserve but also to increase its dominant position”, de Silva added.
Under the terms of the settlement, Google made commitments to improve the way Ad Manager Services workers with rival ad servers and as space sales platforms, the French watchdog said. Some changes would be implemented by the first quarter of 2022, it said, adding that Google would not appeal the decision.
Google announced, on Monday (June 7, 2021) in a blog, its decision to make changes to its advertising technology.
Maria Gomri, Legal Director of Google France, wrote “We recognize the role that ad tech plays in supporting access to content and information and we’re committed to working collaboratively with regulators and investing in new products and technologies that give publishers more choice and better results when using our platforms”.
The French antitrust authority said that its decision opened the way for publishers who felt disadvantaged to seek damages from Google and hope that it inspires similar competition cases in the US and other jurisdictions.
“This sanction and these commitments will make it possible to re-establish a level playing field actors, and the ability of publishers to make the most of their advertising spaces”, Isabell de Silva, France’s Antitrust Chief said.
“The decision to sanction Google is of particular significance because it’s the first decision in the world focusing on complex algorithmic auction processes on which the online ad business relies”, she added.
“This decision is a key milestone to re-energize competition and innovation in the ad tech space and publishers, who are the primary victims of Google practices, will ultimately benefit from it, but the battle is only beginning,” said Arnaud Creput, Chief Executive of Smart, which provides ad tech to publishers.
The decision was welcomed by French Finance Minister Bruno Le Maire.
“The practices put in place by Google to favor its own advertising technologies have affected press groups, whose business model is heavily dependent on ad revenues. These are serious practices and they have been rightly sanctioned.”, he said.