Google's plan to block cookies draws US antitrust scrutiny

Google advertising rivals are concerned that Google will continue to gather user data for itself via loopholes while they would lose the data-gathering tool

Google's plan to ban third-party cookies in Chrome browser has reportedly drawn antitrust scrutiny from the US regulators over concerns that the move could hobble smaller rivals.

The search giant said last year that it would ban cookies in Chrome in an effort to increase user privacy.

According to Reuters, investigators from the US Department of Justice (DoJ) have been asking advertising industry executives whether Google's decision to block cookies will hamper their ability to conduct business.

Over the last two months, Google has revealed more details about its plan. The search giant proposes to replace cookies with a mechanism called Federated Learning of Cohorts (FLoC), which would track people in aggregate and cluster them together in large groups with similar interests.

It appears that many ad rivals of Google are not satisfied with these proposals, and are complaining that while they would be prevented from tracking users through cookies, Google will continue to gather user data for itself via loopholes.

One of the sources told Reuters that executives from more than a dozen firms from various sectors have discussed the issue with DoJ investigators, explaining how the Chrome policies would affect the ad and news industries.

The US Justice Department has been investigating Google's advertising and search business since mid-2019. Last October, it filed a long-awaited lawsuit against the company over alleged use of anticompetitive practices to maintain its dominance in the market.

Earlier this week, a group of US states, led by Texas, amended their antitrust complaint against Google to allege that its planned changes for Chrome "are anticompetitive because they raise barriers to entry and exclude competition."

The original complaint' filed in December, accused the company of misleading advertisers and users alike.

The complaint said that the search giant was manipulating users into logging into Chrome browser and routing advertising requests to its own exchange, even when a rival exchange had offered a higher bid.

Google has defended the upcoming changes, saying they will improve user privacy.

Earlier this month, Google said that it planned to stop selling ads that rely on users' web browsing history.

The company stated that once cookies are gone from Chrome, it would neither create nor use any alternative user-level identifiers in its products to track people as they browse across websites.

"If digital advertising doesn't evolve to address the growing concerns people have about their privacy and how their personal identity is being used, we risk the future of the free and open web," David Temkin, Google's director of product management for ads privacy and trust, wrote in a blog post.

Temkin said that user-level identifiers are unlikely to meet growing expectations for user privacy. He emphasised that such identifiers would not "stand up to rapidly evolving regulatory restrictions," and "therefore aren't a sustainable long term investment".

A source told Reuters that if the DoJ decides to sue Google over adtech concerns, it could either file a new lawsuit or join the Texas case.

There is also a possibility that the Department could amend its existing complaint to include Google's ad-related conduct.