EU opens antitrust probe into Google’s advertising business

The European Union opened a formal antitrust probe into Google’s lucrative advertising business, signaling it will scrutinize whether the search giant is abusing its increasingly outsize market power.

The European Commission, the legislative branch of the EU that is overseeing the investigation, said Tuesday it is considering whether Google has broken EU rules by favoring its own online advertising services over competitors. It’s also probing if Google is “distorting competition” by restricting third-party access to user data for advertising while keeping such data for its own use. 

“We are concerned that Google has made it harder for rival online advertising services to compete,” European Commission executive vice president Margrethe Vestager said in a statement

Google did not immediately respond to a request for comment. 

While the company has its hands in everything from driverless cars to mobile phones, ads are by far Google’s most important revenue stream. Advertising brought in $147 billion for the firm last year — about 80 percent of Google’s total income. 

Google dominates the digital advertising market worldwide, raking in 27.5 percent of all global ad spending, according to market research firm eMarketer. Its share of the US ad market last year was 28.9 percent, according to the firm.

“Google collects data to be used for targeted advertising purposes, it sells advertising space and also acts as an online advertising intermediary. So Google is present at almost all levels of the supply chain for online display advertising,” said Vestager.

Google headquarters
Advertising brought in $147 billion for the firm last year — about 80 percent of Google’s total income. 
zz/John Nacion/STAR MAX/IPx

News of the impending EU probe was first reported by Reuters last week.

The European Commission probe builds on three previous probes that have resulted in $9.8 billion in total fines so far. 

In 2018, the EU slapped Google with a record $5 billion fine for forcing cellphone makers to install Google apps on phones using the company’s Android operating system. And in 2017, the EU made Google pay $2.7 billion for using its search engine to steer customers toward its own shopping platform. A third $1.7 billion fine in 2019 centered on Google’s advertising sales practices.  

Google also faces antitrust probes in the US from the Department of Justice and from several states’ attorneys general. 

Last week, congressional lawmakers introduced five antitrust bills that could force Google and other tech giants like Apple and Amazon to overhaul or even break up their business empires.

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