Google Hit With $1.7 Billion Fine in Europe for Abusing Advertising Dominance

“Google has cemented its dominance in online search adverts and shielded itself from competitive pressure by imposing anti-competitive contractual restrictions on third-party websites,” EU antitrust commissioner Margrethe Vestager said on Wednesday. “This is illegal under EU antitrust rules. The misconduct lasted over 10 years and denied other companies the possibility to compete on the merits and to innovate – and consumers the benefits of competition.”

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Vestager noted that in response to the Android fine, Google has done a better job offering users choices for browsers and search engines.

“We’ve seen in the past that a choice screen can be an effective way to promote user choice,” Vestager said. “It is welcome that Google is stepping up its effort and we will watch closely to see how the choice-screen mechanism evolves.”

In a statement and press conference from Brussels, Vestager described Google’s transgressions that led to the latest fine.

Google’s AdSense, which Vestager called “by far the strongest player in online search advertising” in Europe, works when websites embed search functions and the results are displayed alongside advertisements where the revenue is split with publishers.

In contracts with customers reviewed by investigators, Google at various times prohibited any search advertisements from competitors like Microsoft or Yahoo, prohibited any competitors ads from displaying above their own and also required publishers to get written approval from Google before changing the way they handle advertisements from tech rivals.

“Google’s rivals were not able to compete on the merits, either because there was an outright prohibition for them to appear on publisher websites or because Google reserved for itself by far the most valuable commercial space on those websites, while at the same time controlling how rival search adverts could appear,” Vestager said. “Google’s practices amount to an abuse of Google’s dominant position in the online search advertising intermediation market by preventing competition on the merits.”

Source: Google Hit With $1.7 Billion Fine in Europe for Abusing Advertising Dominance