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EU and UK launch antitrust investigations against Google and Meta over online advertisements

Regulators in Europe and the UK have launched an antitrust investigation into a deal between Google and Meta over online advertising, in the latest attempt to tackle the market power of advertisers. largest technology company in the world.

The move follows US antitrust investigators, who also probe a deal unofficially known as “Jedi Blue”. The search engine giant and Facebook’s parent company have been accused of working together to profit from advertising, acting together to bolster their businesses.

The EU and UK polls represent the latest attack on Big Tech from global regulators, who are also preparing to introduce new rules designed to challenge the position dominance of groups like Google, Meta, and Amazon. In response, American technology corporations have launched lobbying efforts in Washington and Brussels to protect their interests.

Margrethe Vestager, the EU’s head of competition, told the Financial Times: “Advertising is very important and therefore it is important to have competition over who can place ads where. She said Britain and the EU had agreed to open an investigation into the matter on the same day.

She added: “There are people other than Google doing that. What we suspect here is that there may have been an agreement between Google and then Facebook to use only Google services and not competing services. It’s a huge problem.”

Companies found in breach of EU law can lose up to 10% of their global revenue, but legal processes can take years.

Google says that “allegations made about [the Jedi Blue] agreement is untrue”. It added: “The goal of this program is to work with multiple ad networks and exchanges to increase publishers’ demand for ad space, helping those publishers earn more revenue. .”

“Our non-exclusive bidding agreements with Google, and similar agreements we have with other bidding platforms, have increased competition for ad placements,” says Meta.

Both groups vowed to cooperate with regulators.

Google and Meta have been frequent targets of EU antitrust investigations in recent years, and Europe has been at the center of a regulatory backlash to Big Tech’s economic strength. .

Vestager said the European Commission is also investigating suspicions that Google may have acted alone without Meta’s knowledge. “We haven’t concluded yet if it’s a Google-only thing or if they’re in it together. Meta was not aware of the impact of the deal and that is something we have to investigate,” she said.

The coordinated investigation by Brussels and the UK’s Competition and Markets Authority is the second time in less than a year the two regulators have launched a joint attack on Big Tech, after a poll on Facebook in June.

The Commission and the CMA are assessing the extent to which Meta has abused its dominant position in the social media or digital advertising markets through the use of data. That poll is continuing.

Andrea Coscelli, CMA chief executive, said: “We are concerned that Google may have partnered with Meta to hinder competitors from providing important online display advertising services to advertisers. publishing company.”

The CMA first discovered the problems with Google and Meta’s dominant role in the online advertising market in a report published in July 2020. Google has more than 90% share in the advertising market. Search advertising is worth £7.3 billion in the UK and Meta controls more than half of the £5.5 billion display advertising market.

The UK watchdog said Google and Facebook were protected by “such strong incumbent advantages. . . that potential competitors can no longer compete equally”. It said the market strength of both companies had a “significant impact on prices and revenue”.

The CMA is aiming to address the potential harms stemming from the power of web-based platforms through its new digital marketplace unit, a technology regulator within the watchdog. The unit is expected to be officially launched through new legislation in the coming months.

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