https://safirsoft.com Google will pay $268M, revamp ad platform to settle antitrust claims

“Google took advantage of its vertical integration,” French regulator says.

Google is paying a $268 million fine and, in a first, has agreed to overhaul its advertising platform to settle an antitrust probe in France.

After a two-year investigation, the French Competition Authority found that Google had used its ad-management platform for publishers to bolster its ad marketplace, where publishers sell inventory in real time. “Google took advantage of its vertical integration to skew the process,” said Isabelle de Silva, the authority’s president, at a press conference on Monday.

When publishers display ads on a site, they have two options. One is to run ads they’ve sold directly to advertisers. The other is to sell space to an exchange, where multiple advertisers bid to run their ads. In the latter case, known as programmatic advertising, publishers will often put ad space up for auction on multiple exchanges, but they’ll typically use only one ad server to coordinate the auctions and award-winning bids.

Google privileged its own services by allowing data to flow more freely between the manager, formerly known as DoubleClick for Publishers (DFP), and the exchange, formerly known as DoubleClick Ad Exchange (AdX), the authority claimed.

First, Google ensured that DFP worked better with AdX. DFP also shared key data with the exchange, like the price of winning bids. AdX then used that data to optimize future bids when competing with other ad exchanges.

Second, AdX returned the favor by working better with DFP. “The AdX platform is only partially interoperable with DFP’s competing ad servers and does not allow the latter to organize a competition between AdX and its competitors—even though AdX itself has a privileged access to a significant portion of advertisers’ demand and while all of these competitors have adopted standards allowing for fairer competition,” the authority said.

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The ease with which the two sides of Google’s platform worked with each other “limited the attractiveness” of competing ad servers and managers, allowing the company to increase its market share, the authority said. Google merged DFP and AdX into one platform called Ad Manager in 2018.

Google acquired DFP and AdX when it bought DoubleClick in 2008 for $3.1 billion. When the acquisition was first announced in 2007, both the Federal Trade Commission and the European Union launched investigations, though both closed the inquiries after concluding that Google’s purchase wouldn’t reduce competition.

As part of the settlement announced today, Google made five commitments to the French Competition Authority, including a pledge to allow third-party platforms wider access to data. Google will also improve the way Google Ad Manager works with competing platforms, and it will no longer share competitors’ pricing data with AdX. An independent trustee will oversee the changes, which Google anticipates will begin rolling out in early 2022. The company also said “some” of the changes will be released globally, though it didn’t specify which or where those would surface.

Further ReadingAntitrust 101: Why everyone is probing Amazon, Apple, Facebook, and GoogleThree publishers filed complaints with the authority, including News Corp. in 2019. The company has been a frequent antagonist of Google, Facebook, and other Big Tech platforms for years, arguing that they use unfair practices to boost their own ad products over those of publishers.

Big Tech firms like Google have come under increasing scrutiny in recent years as their revenues grow in tandem with their market power. France isn't alone in investigating Google over concerns that it was abusing its position. In October, the US Department of Justice announced that it had filed an antitrust lawsuit against Google, alleging that it had forced rivals out of the search game.

Google will pay $268M, revamp ad platform to settle antitrust claims
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