Google is in hot water once again after UK's watchdog announced that it would investigate the tech giant for the second time.
The regulator fears that the tech giant is deliberately freezing out competitors.
CMA to Investigate Google's AdTech Practices
The Competition and Markets Authority's (CMA) second investigation of Google's adtech practices came an ad deal between Facebook and Google, referred to as Jedi Blue, was finalized.
The deal between the two massive companies was done back in March, and it prompted a major antitrust complaint against Google's adtech in the UK, according to TechCrunch.
The CMA also opened a probe of Google's ad-related Privacy Sandbox plan in 2021. It was triggered by complaints about its planned deprecation of tracking cookies to migrate to an alternative stack of ad targeting technologies.
This development remains under external monitoring after a settlement between Google and the CMA, which looks to have slowed the pace of any switch.
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Google has also recently changed its approach to push for topic-based ad targeting instead of cohorts.
The latest Google probe by the CMA focuses on what the regulator describes as the strong positions Google holds in adtech intermediation.
The regulator suspects that Google could be distorting competition since the tech giant owns the largest service provider in three key parts of the chain.
The parts where it will be examining Google's dominance are DSPs, ad exchanges, and publisher ad servers.
The DSPs are the demand-side platforms that enable advertisers and media agencies to purchase the available ad space of publishers from many sources.
The ad exchanges allow the tech to automate publishers' ad inventory sales through real-time auctions, and publisher ad servers manage the publisher inventory and determine which ad to show based on bids received from exchanges or direct deals between the advertisers and publishers.
The regulator wrote in a press release that the CMA is assessing whether Google's practices in these parts of the ad tech stack may distort competition, according to CNBC.
These include whether Google limited the interoperability of its ad exchange with third-party publisher ad servers and contractually tied these services together, making it more challenging for rival ad services to complete.
The CMA is also concerned that the tech giant may have used its publisher ad server and its DSPs to illegally favor its own ad exchange service while taking steps to exclude the services offered by its rivals.
Google's Share in AdTech Tech Stack
Google has a dominant share across the key parts of the adtech tech stack, according to The Verge.
But its ad products had evolved and merged over the past few years, as well as undergoing some rebranding, like when Google sought to move away from the DoubleClick brand back in 2018, all of which makes what is already a complex and even opaque market structure even more difficult for outsiders to get a handle on.
Among several concerning characteristics, the CMA found were inhibiting competition in the ad market in 2020. The lack of transparency made it difficult for market participants to understand how decisions are made.
Other characteristics it suggested were undermining effective competition in the digital ad market: network effects, consumer decision-making, economies of scale, and the power of defaults.
The unequal access to user data, vertical integration, the importance of ecosystems, and resultant conflicts of interest are also the other characteristics that the CMA suggested.
In 2021, the UK watchdog questioned Google and Apple about their process of accessing the age of their users.
In May, the UK watchdog fined Clearview AI for illegally collecting the images of UK residents.
Related Article: Google UK is Pushing for Strict Screening Due to Rise in Fraudulent Ads
This article is owned by Tech Times
Written by Sophie Webster
