France’s competition watchdog has slapped Google with a €150 million (~$166 million) fine after finding the tech giant abused its dominant position in the online search advertising market.
In a decision announced today — following a lengthy investigation into the online ad sector — the competition authority sanctioned Google for adopting what it describes as “opaque and difficult to understand” operating rules for its ad platform, Google Ads, and for applying them in “an unfair and random manner.”
The watchdog has ordered Google to clarify how it draws up rules for the operation of Google Ads and its procedures for suspending accounts. The tech giant will also have to put in place measures to prevent, detect and deal with violations of Google Ads rules.
A Google spokesman told TechCrunch the company will appeal the decision.
The decision — which comes hard on the heels of a market study report by the U.K.’s competition watchdog asking for views on whether Google should be broken up — relates to search ads which appear when a user of Google’s search engine searches for something and ads are served alongside organic search results.
More specifically, it relates to the rules Google applies to its Ads platform which set conditions under which advertisers can broadcast ads — rules the watchdog found to be confusing and inconsistently applied.
It also found Google had changed its position on the interpretation of the rules over time, which it said generated instability for some advertisers who were kept in a situation of legal and economic insecurity.
In France, Google holds a dominant position in the online search market, with its search engine responsible for more than 90% of searches carried out, and holds more than 80% of the online ad market linked to searches, per the watchdog, which notes that that dominance puts requirements on it to define operating rules of its ad platform in an objective, transparent and non-discriminatory manner.
However, it found Google’s wording of ad rules failed to live up to that standard — saying it is “not based on any precise and stable definition, which gives Google full latitude to interpret them according to situations.”
Explaining its decision in a press release, the Autorité de la Concurrence writes [translated by Google Translate]:
[T]he French Competition Authority considers that the Google Ads operating rules imposed by Google on advertisers are established and applied under non-objective, non-transparent and discriminatory conditions. The opacity and lack of objectivity of these rules make it very difficult for advertisers to apply them, while Google has all the discretion to modify its interpretation of the rules in a way that is difficult to predict, and decide accordingly whether the sites comply with them or not. This allows Google to apply them in a discriminatory or inconsistent manner. This leads to damage both for advertisers and for search engine users.
The watchdog’s multi-year investigation of the online ad sector was instigated after a complaint by a company called Gibmedia — which raised an objection more than four years ago after Google closed its Google Ads account without notice.