EU Fines Google $2.95B Over Adtech 'Abuse'
The European Commission announced this week that it has fined Google 2.95 billion euros (approximately $3.5 billion) for violating EU antitrust rules by favoring its own advertising services.
In a statement, the commission said Google abused its dominant positions in the digital advertising market by giving preferential treatment to its ad exchange AdX in both its publisher ad server and in its ad-buying tools. This self-preferencing practice allowed Google to gain an unfair advantage over competitors, ultimately harming consumers and other businesses.
"We have found that Google has abused its dominant position in the digital advertising market," said Margrethe Vestager, the European Commission's executive vice president for competition policy. "Google's behavior is unacceptable and must be stopped."
The commission gave Google 60 days to bring an end to these self-preferencing practices and implement measures to address inherent conflicts of interest along the adtech supply chain.
"This decision sends a clear message that digital markets exist to serve people, not just companies," said Teresa Ribera, the commission's executive vice president for clean, just and competitive transition. "We will continue to monitor Google's behavior and take action if necessary."
Google has announced plans to appeal the commission's decision. A spokesperson told The Wall Street Journal that the company would challenge the fine, stating, "There's nothing new here - a short-term measure in one subset of our products, as we've maintained since the original complaint, and the vast majority of the complaint remains unchanged."
The European Commission's move is part of its ongoing efforts to regulate the tech industry and ensure fair competition. The commission has been investigating Google's advertising practices for several years, and this fine marks a significant step in that process.
Background on the issue dates back to 2019 when the commission launched an investigation into Google's dominance in the digital advertising market. In 2020, the commission found that Google had abused its dominant position by favoring its own ad exchange AdX over competitors.
The implications of this fine are significant for both Google and the broader tech industry. The fine is one of the largest ever imposed on a single company, and it sets a precedent for how regulators will approach antitrust cases involving digital markets.
In response to the fine, some experts have called for greater regulation of the tech industry. "This decision highlights the need for more effective regulation of digital markets," said Dr. Ian Stewart, a professor of economics at Oxford University. "The European Commission has shown that it is willing to take action against companies that abuse their dominant positions."
As Google prepares to appeal the fine, the company's future in Europe remains uncertain. The commission has made it clear that it will continue to monitor Google's behavior and take further action if necessary.
In a statement, the commission said, "We will not hesitate to impose strong remedies if Google fails to address its conflicts of interest."
*Reporting by Techcrunch.*
