Proactive Investors - The UK Competition and Markets Authority has provisionally determined that Google is abusing its dominant position in the advertising technology space.
According to the watchdog, the Alphabet (NASDAQ:GOOGL)-owned search giant “disadvantages competitors and prevents them competing on a level playing field to provide publishers and advertisers with a better, more competitive service that supports growth in their business”.
Central to the investigation is Google’s ‘self preferencing’ of its own advertising exchange. This potentially means advertisers and publishers are not getting a fair deal when buying and selling advertising space.
The sale of online advertising space between publishers and advertisers is facilitated through intermediaries, of which the CMA believes Google has a “competitive advantage” through its AdX platform.
Google is “manipulating advertiser bids so that they have a higher value when submitted into AdX’s auction than when submitted into rival exchanges’ auctions”, the CMA has alleged.
The CMA is now considering what may be required to ensure that Google ceases the anti-competitive practices.
Google could be fined up to 10% of its annual worldwide turnover under the Chapter II provision of the Competition Act 1998, which prohibits the abuse of a dominant position which may affect trade within the UK.