France made Google pay $270 million for unfair advertising practices

WHAT YOU NEED TO KNOW:

• Competition watchdog French Competition Authority issued a $268 million fine against Google on Monday following its abusive online advertising practices.
• Google announced that it will revise its digital marketing practices given the violation.
• European regulators have probed US social media giants in recent years over their global practices.

The French Competition Authority handed a 220 million euros ($268 million) fine to Google on Monday after abusing its market reach in the field of digital advertisement.

The competition watchdog said that Google exploited its own services and overwhelmed online competition. The group said that the company will be paying the penalty and will abandon its exploitive actions.

Google was found to provide special treatment to its DFP advertising server, which enables site and application publishers to sell their online market space, per the investigation. The company also gave preferential treatment to its SSP AdX listing platform, which manages auction processing and grants publishers to market their “impressions” to advertisers. Because of this practice, Google’s competitors and publishers cannot have their fair share in the online market.

In a statement, French Competition Authority president Isabelle de Silva said that the decision is the world’s first movement at looking “at the complex algorithmic auction processes by which online advertising ‘display’ operates.”

De Silva also noted that the inquiry showed that Google abused its online leverages against competitors with regard to advertising servers and other marketing platforms.

“These very serious practices have penalized competition in the emerging online advertising market, and have enabled Google not only to preserve but also to increase its dominant position,” she argued.

“This sanction and these commitments will make it possible to re-establish a level playing field for all actors, and the ability of publishers to make the most of their advertising spaces.”

In a blog announcement Monday, Google said that it would be revising its digital advertising movements.

“We recognize the role that ad tech plays in supporting access to content and information and we’re committed to working collaboratively with regulators and investing in new products and technologies that give publishers more choice and better results when using our platforms,” Google France legal director Maria Gomri wrote.

The investigation on Google came after several groups such as US-based news outlets, French newspaper Le Figaro, and Belgian’s press group Rossel issued a formal complaint against the company.

In recent years, European investigators were tracking down US-based social media giants over concerns of having broad influence to around 700 million population. 

Regulators from the UK and Europe initiated an antitrust inquiry against Facebook last week. In the past years, the European Commission had also spearheaded investigations against Microsoft, Amazon and Google. In January, the UK’s Competition and Markets Authority also launched an investigation, probing Apple and Google’s efforts after becoming an independent regulator following Brexit.

Source: CNBC