Brussels hits Google for €1.5bn over ad market abuse

googleThe European Commission has whacked Google with a €1.49bn (£1.28bn) fine for abusing its monopoly in online advertising, taking the total the company has been fined by Brussels to €8.24bn (£7.1bn) over the past two years.
The case centred on its use of AdSense technology, which allows Google to advertise on third party websites in exchange for offering them a search box. However, between 2006 and 2016 Google included “exclusivity clauses” in some AdSense contracts which prevented publishers from placing ads from Google rivals on their search pages.
In 2009, Google replaced the strategy with “relaxed exclusivity”, which allowed rival ads to be run but Google controlled how they were placed, preventing them from being on “the most profitable space on their search results pages”.
“Google’s practices covered over half the market by turnover throughout most of the period,” the competition commission said. “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.”
Margrethe Vestager, the EU’s competition commissioner, said: “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. 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.”
Google ditched the practices in 2016. In a statement, the company said: “We’ve always agreed that healthy, thriving markets are in everyone’s interest. We’ve already made a wide range of changes to our products to address the commission’s concerns. Over the next few months, we’ll be making further updates to give more visibility to rivals in Europe.”
The fine comes on top of the €4.3bn (£3.7bn) penalty issued last year relating to its Android mobile operating system and a €2.4bn (£2.1bn) fine for promoting its own shopping service over rivals.
However, in its latest results, Google owner Alphabet recorded pre-tax profits of $30.7bn (£23bn) in 2018, up from $12.66bn in 2017.

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