EU could force Google to sell parts of its adtech empire

Tech giant controls both buy and sell sides of online ad auctions says competition commissioner

The EU Competition Commission could order Google to sell part of its advertising business.

The antitrust regulator has accused Google of favouring its own online display advertising technology services and disadvantaging competitors, advertisers and online publishers.

The regulator's latest stement follows a two-year investigation into Google's ad-tech business, which concluded that the tech giant had abused its position in online advertising by prioritising its own online exchange, AdX, in auctions held by its own ad server, DFP, and in the bidding process of its own ad-buying tools, Google Ads and DV360.

The regulator said these practices are illegal under its antitrust rules and have increased costs for advertisers and reduced earnings for advertisers and publishers.

"The Commission takes issue with Google favouring its own online display advertising technology services to the detriment of competing providers of advertising technology services, advertisers and online publishers," it said in an online statement.

In a tweet on Wednesday, competition commissioner Margrethe Vestager said the company was continuing to using its dominant position to profit from both sides of a sale.

"Google controls both sides of the adtech market: sell & buy. We are concerned that it may have abused its dominance to favour its own AdX platform. If confirmed, this is illegal. The EU Commission might require Google to divest part of its services."

In a press briefing, Vestager criticised Google for continuously modifying its behaviour to evade detection while continuing to monopolise the adtech market.

"Each time a practice was detected … Google simply modified its behaviour so as to make it more difficult to detect," she said.

She suggested that because it had failed to amend its practices and to eliminate conflicts of interest, Google should be forced to sell parts of its ad business, such as sell-side tools DFP and AdX.

The European Commission said it was "sending a Statement of Objections to Google over abusive practices in online advertising technology."

Dan Taylor, Google's vice-president of global ads, defended the company's advertising technology tools,

"Google remains committed to creating value for our publisher and advertiser partners in this highly competitive sector. The Commission's investigation focuses on a narrow aspect of our advertising business and is not new," he said in a statement.

"We disagree with the EC's view and we will respond accordingly."

Google has a few months to respond to the EU's charges, and it can request a closed hearing with senior Commission antitrust officials before a decision is made. The process may take a year or more.

The EU's ruling reflects Google's dominance in the global ad market, where it commands a 28% share of all ad revenue through properties including YouTube, Google Maps, AdSense and AdMob.

The UK Competition and Markets Authority (CMA) has also been conducting a separate investigation into Google's ad-tech platform since May 2022.