By Joseph Chalfant
Tech giant Google has agreed to change its advertising practices after receiving a massive $268 million fine from the French Competition Authority (FCA).
The French competition watchdog said it issued the fine against Google “for having abused its dominant position in the advertising server market for website and mobile applications publishers.”
Two programs are at the heart of FCA’s issues with the tech giant, DoubleClick for Publishers and Google’s Supply Side Platform, known as AdX. DoubleClick is an ad server that helps publishers organize and sell their ad space, while AdX acts as an auction house for publishers to sell ad views to potential advertisers.
The FCA found that Google’s DoubleClick had strategically benefited the company’s Supply Side Platform (SSP) by offering pricing data from competitors to optimize prices and win more bids. Further, compatibility issues between AdX and competing servers ensured that Google’s systems maintained a favorable position in the marketplace.
The watchdog group stated that “Google has not disputed either the materiality of the practices in question, their legal qualification, or their imputability.” The statement marks a majority shift, where Google has previously denied anticompetitive behavior with its ad practices.
Press groups News Corp Inc., Le Figaro, and Rossel La Voix brought on the original complaint against Google, but Le Figaro later withdrew.
The FCA stressed that the practices were particularly concerning because the groups “were affected even though their economic model is also strongly weakened by the decline in sales of print subscriptions and the decline in associated advertising revenue.”
Google has faced further antitrust scrutiny internationally. In April, the owner of the Daily Mail filed a lawsuit with similar claims regarding Google’s advertising practices.
In addition to the fine, Google has been mandated to offer third-party SSP compatibility to allow for more competition between publishers using AdX with other servers for three years, to improve transparency for the auction process, and cease its use of competitors’ pricing to optimize its bidding practices unfairly.
“The decision sanctioning Google has a very special meaning because it is the first decision in the world to look into complex algorithmic auctions processes through which online display advertising works,” said Isabelle de Silva, President of the FCA. “These very serious practices penalized competition in the emerging online advertising market and allowed Google not only to maintain but also to increase its dominant position. This sanction and these commitments will make it possible to re-establish a level playing field for all players, and the ability for publishers to make the most of their advertising space.”
The decision comes as the antitrust movement against tech corporations gains momentum in the U.S. In recent months, high-profile events like Epic v. Apple and a Senate Judiciary Committee hearing on antitrust reform may signify antitrust action is on the horizon.
