European Union regulators on Wednesday sanctioned Google for manipulating competition in online advertising. The internet giant now faces a 1.49 billion euro (approximately $1.7 billion) fine, its third largest antitrust penalty since 2017.
Based on the latest ruling, Google was found to have imposed exclusivity on contracts with website owners that utilized its AdSense business, an action that restricted Google rivals from placing ads on their sites.
AdSense For Search service (or simply AdSense) enables Google to mediate between website owners and advertisers through selling adverts space. This platform permits web publishers to put text ads on their sites, which content is based on results of search functions.
EU’s competition commissioner, Margrethe Vestager, said that Google abused its dominant role in the online search adverts sector and prevented its rivals from innovating and competing fairly. She noted that Google left the website owners and advertisers deal with higher ad cost that would then be transferred to and burdened by consumers.
Kent Walker, senior vice president of global affairs of Google responded and said that Google agrees that a healthy and thriving market is everyone’s interest. He noted that they’ve already done changes to their products to abide by the commission’s standards. Walker also said that they would also be doing updates in the coming months to provide better visibility for their competitors in Europe.
Alphabet, Google’s parent company, earlier defended that its ad technology has been existent since 2006, is already displaced and now only a minor product.
The commission said that Google had been the top player in online search adverts in Europe between 2006-2016, with a 70 percent share of the total market. The internet giant’s advertising business had a 20 percent increase in revenue in the last quarter of 2018.
Google also faced two sanctions from the EU in the previous years. First is the shopping case in 2017 which resulted in a 2.42 billion euro ($2.7 billion) fine and just last year, another ruling about their Android operating system that led to 4.34 billion euro ($5 billion) penalty.
In response to the latter case, the Silicon Valley tech company now gives customers the freedom to choose which app to use on their OS, unlike before where apps were forcefully bundled on its Playstore.
Vestager said that she welcomes the news and is seeing good developments in both cases and the European Commission will continue to watch how this will unfold.
