UK competition watchdog challenges Google’s ad practices

The authority found that Google may have abused its dominant position and disadvantaged third parties with its adtech practices.

The UK Competition and Markets Authority (CMA) has provisionally found that Google’s actions as a dominant player in adtech is harming advertisers and publishers and may have broken competition law.

In a statement released today (6 September), the CMA said that Google appears to preference its own services in the provision of digital ads on websites, thereby disadvantaging competitors that use its adtech services.

“We’ve provisionally found that Google is using its market power to hinder competition when it comes to the ads people see on websites,” said Juliette Enser, the interim executive director of CMA.

This comes as a result of the CMA’s investigation into Google’s adtech practices opened in 2022. While a few months ago, the video sharing platform Rumble sued Google claiming that it “monopolised the adtech stack” by acquiring companies that represent “both ad buyers and sellers”.

Last year, the EU opened an investigation into Google and alleged the tech giant breached EU antitrust laws over its attempts to influence its market position in the adtech sector.

How does Google adtech work?

Advertisement publishers, including websites and mobile apps, sell space for online open-display advertisements (also called sellers) – and those who want to advertise, buy these spaces, (also called buyers).

When users open applications, programmed auctions and transactions take place to determine the placement of the advertisement that users will view.

Google has a powerful market position in all three aspects of advertising involved here. For sellers or publishers, Google operates DoubleClick For Publishers (DFP). For buyers or advertisers looking to purchase ad space, Google has two ad-buying tools, Google Ads and DV360. And as intermediary, conducting the auctions, Google operates AdX.

The CMA interim results find that since at least 2015, Google has protected AdX from competition by abusing its dominant position through its buying tools (Google Ads and DV360) as well as publisher ad servers (DFP).

It also found that Google’s actions harm DFP’s rivals.

The CMA explained that Google’s actions involved providing AdX with exclusive or preferential access to advertisers, manipulating ad bids so that they have a higher value when submitted into AdX’s auction than when submitted into rival exchanges’ auctions and allowing AdX to bid first in auctions run by DFP for online advertising space, effectively giving it a ‘right of first refusal’ – with rivals potentially not having any chance to submit bids.

In a statement to Tech Crunch, Google’s VP of Global Ads Dan Taylor said that Google is “committed to creating value” for its publisher and advertiser partners.

“The core of this case rests on flawed interpretations of the adtech sector. We disagree with the CMA’s view and we will respond accordingly.”

The CMA said it will provide a final decision on the matter after Google responds to its interim findings.

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