Google has been accused by the UK Competition and Markets Authority (CMA) of abusing its dominant position in the online advertising market, overcharging publishers and stifling competition.
The CMA issued a statement of objections to the tech giant on Friday, following an investigation that suggested Google’s actions may be illegal.
The case adds to a series of global challenges against Google’s control over digital advertising, with similar actions underway in the US and EU. The regulator alleges that Google’s grip on multiple stages of the online advertising stack (the split-second auction system used to place ads on web pages) allows it to charge publishers high fees while sidelining competing advertising services.
Google controls a significant portion of both the ad servers that sell space and the online exchanges where ads are bought and sold, with advertisers spending billions annually on display ads. Juliette Enser, interim enforcement director of the CMA, highlighted the impact on businesses that rely on online advertising to keep digital content free or affordable, and stressed the importance of ensuring that publishers and advertisers benefit from fair competition.
The News Media Association, which represents British news organisations, urged the CMA to act quickly on new competition laws that will create a specialist digital markets unit within the regulator. Owen Meredith, chief executive of the association, highlighted the need for urgent action, saying: “We need the new digital markets regulator to start investigating the big tech platforms as soon as possible, with Google Search and Google Ad Tech among the top priorities. for direction.”
He added: “By creating a level playing field, we can create a digital economy for Britain that promotes real competition and drives growth in these crucial markets.”
However, Google disputes the CMA’s allegations. Dan Taylor, Google’s vice president of global advertising, criticized the allegations, stating: “The core of this case rests on flawed interpretations of the ad tech industry. We disagree with the CMA’s position and will respond accordingly.”
The CMA has the power to fine Google or require Google to stop anti-competitive practices. There are discussions in the EU that Google may need to be broken up to address market imbalances.
Google faces a US trial next week on similar anti-monopoly charges brought by the Justice Department, following its recent defeat in a separate competition case over its dominance of the search engine market. As Google prepares to defend its advertising practices in court, mounting legal pressure underlines global scrutiny of its market power.