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Google fined €1.49bn for restricting rivals’ ads

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MARCH 20, 2019

Google has been fined €1.49bn (£1.28bn) by the EU for breaching competition laws with its AdSense advertising service – its third such fine in as many years.

Announcing the new fine, the EU’s competition commissioner Margrethe Vestager said Google had restricted rivals from appearing in online search advertisements.

Ms Vestager said the company had been fined for its “illegal practices in search advertising brokering to cement its dominant market position”.

“They shouldn’t do that – it denied consumers choice, innovative products and fair prices,” added Ms. Vestager. 

In response, a Google spokesperson said the company had made a “wide range of changes” to address the commission’s concerns.

The fine was issued because AdSense, one of Google’s online advertising programs that allows websites to automatically serve targeted ads, was rigged to prevent rivals from appearing in those ads.

Ms. Vestager gave a news conference in Brussels – Reuters

According to the competition investigation, Google had been including “exclusivity clauses” in its contracts with publishers since 2006.

These were gradually replaced from 2009 with a different form of restriction known as a “premium placement” clause which prevented rivals’ ads from being placed in the best advertising spots.

According to the commission, the fine follows its conclusion that “Google is dominant in the market for online search advertising intermediation in the EEA since at least 2006” with more than 85% of market share over that period.

“Google has abused this market dominance by preventing rivals from competing in the online search advertising intermediation market,” the commission added.

The logo of Google Play is seen on a screen. In the background there is the logo of Google. Alphabet is the mother company of Google. It has a revenue of 117 billion dollars. (Photo by Alexander Pohl/NurPhoto via Getty Images)

The fine is equal to 1.29% of Google’s turnover in 2018, but the commission stated that Google is also liable to be sued in civil cases by rivals who were harmed by its illegal practices.

It is the third time that Google has been fined by the competition commissioner since 2017, taking the total amount to €8.23bn (£7bn).

Last July, Google was fined €4.34bn (£3.8bn) by the EU for abusing its control of the Android operating system by forcing vendors to pre-install its apps.

A general view of a Google logo. (Photo by Katie Collins – PA Images/PA Images via Getty Images)

The year prior, the web giant was handed a then-record €2.4bn (£2.2bn) fine for giving its own online shopping service an illegal advantage in internet search results.

It may not be the last fine issued to Google for anti-competitive practices, however.

Ms. Vestager said the commission was still investigating whether Google’s actions in the jobs search market and local search were compliant with competition law.

The Google logo is pictured at the entrance to the Google offices in London, Britain January 18, 2019. REUTERS/Hannah McKay

However, she told a news conference: “We see positive developments both in the shopping and Android case.”

Google had just announced that it would be doing “more to ensure that Android phone owners know about the wide choice of browsers and search engines available to download to their phones.

“This will involve asking users of existing and new Android devices in Europe which browser and search apps they would like to use.”


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