The Antitrust Case That Could Break Up Google

The European Commission (EC) has informed Google of its preliminary view that the company breached EU antitrust rules in the advertising technology industry. This follows a number of antitrust cases over the years against Alphabet, Google’s parent company. The EC is now warning that the company may have to sell off part of its business.

 

History

Since 2010, Google has been fined by the European Union for a number of antitrust cases. Three complaints, concerning Google Shopping, Android OS, and AdSense, have already resulted in formal charges amounting to over €8 billion against the tech giant. Therefore, the latest case against Google, must be considered in the wider context of the company’s historic abuse of its dominant position and breach of EU competition laws.

 

The Latest Case

In the latest antitrust case, Google has been accused of abusing its dominant position in the advertising technology sector. This relates to the company’s buying and selling of online advertisements in light of its market control. Margrethe Vestager, the EC’s Executive Vice President, explained that ‘Google is present at almost all levels of the so-called AdTech supply chain’ and the ‘preliminary concern is that Google may have used its market position to favour its own intermediation services’.

 

The Commission’s preliminary findings established Google’s dominance across publisher ad servers and programmatic ad buying tools for the open web, with its ‘DFP', and ‘Google Ads' and ‘DV360’, services respectively. The EC believes that since 2014, Google’s ad exchange AdX has favoured Google Ads and DV360. By affecting the way bids are placed on the market Google would have given its product a competitive advantage, also foreclosing other ad exchanges, and thereby, breaching Article 102 of the Treaty on the Functioning of the European Union (‘TFEU').

 

What’s Next?

The wider context of Google’s past conduct is important in this case. However, the proposed mandatory divestment of some of Google’s services stands out from the previous sanctions implemented against Big Tech. If ordered, this would constitute the EU’s first break-up of a leading technology group.

 

The EU’s findings, contained in the Statement of Objections, do not prejudge the outcome of an investigation. It remains to be seen whether the EC goes ahead with its plans. For now, it constitutes another sign against regulators’ stricter approach towards Big Tech.

By Scott Hickman