The UK’s Competition and Markets Authority (CMA) has commenced a probe into Google’s advertising practices, accusing the company of potentially distorting competition in favour of its own services in a move highlighting the nation’s toughened stance on technology companies.
CMA stated it would look into three parts of Google’s stack of services which mediate advertising technology: demand-side platforms; ad exchanges and publisher advertising services.
Reuters reported Google is currently the largest provider of all three components.
CMA CEO Andrea Coscelli explained the watchdog was worried Google may be using its position in advertising technology “to favour its own services to the detriment of its rivals, of its customers and ultimately of consumers”.
“This would be bad for the millions of people who enjoy access to a wealth of free information online every day.”
Earlier this year the CMA commenced an inquiry into a deal Google and Facebook (now Meta Platforms) struck in 2018 which favours the search giant’s advertising system while providing the social media company with discounted rates and prime ad placement.
A Google representative told Reuters the company will cooperate with the CMA’s latest probe and provide transparent information on its systems.
Action
In 2021, the UK established the Digital Market Unit (DMU) within the CMA, tasked with preventing tech giants from unfairly leveraging their market dominance, and promoting online competition and consumer choice.
The DMA could influence and suspend decisions made by tech companies and levy financial penalties for non-compliance.
However, earlier this month Financial Times reported the DMU may not be given the statutory powers it needs until the parliamentary session running from 2023 to 2024.
