REG - Competition and Mkts - CMA investigation: Google and Meta

AlphabetAnnouncement

11/03/2022 10:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220311:nRSK4983Ea&default-theme=true

RNS Number : 4983E  Competition and Markets Authority  11 March 2022

CMA investigates Google and Meta over ad tech concerns

·    CMA and European Commission launch parallel probes into Google and
Meta's "Jedi Blue" agreement.

·    CMA Chief Executive says: "We will not shy away from scrutinising the
behaviour of big tech firms while we await powers for the Digital Markets
Unit."

The CMA is taking a closer look at Google and Meta's conduct over concerns
that they hampered competition in markets for online display advertising
services.

The Competition and Markets Authority (CMA) is focusing on whether the
companies restricted or prevented the uptake of header bidding services and
whether Google also affected the ability of other firms to compete with its
products in this area.

Header bidding is a service which allows sellers, such as news publishers, to
offer their online advertising space to multiple buyers at the same time,
rather than receiving offers one by one. As a result, buyers - or advertisers
- compete against each other for ad space and publishers can compare bids from
multiple buyers simultaneously. This competition between buyers can make
auctions more competitive.

As part of its investigation, the CMA will consider whether an agreement
between Google and Meta (previously Facebook) - which Google internally
codenamed "Jedi Blue" - broke the law. The CMA is also scrutinising Google's
conduct in relation to header bidding services more widely to see if the firm
abused a dominant position and gained an unfair advantage over competitors
trying to provide a similar service.

The European Commission (EC) has launched its own probe into the agreement
between Google and Meta and the agreement is also the subject of a complaint
by the State of Texas (and other US States) currently in the US courts. The
CMA will seek to work closely with the EC as the independent investigations
develop.

Andrea Coscelli, CMA Chief Executive, said: "We're concerned that Google may
have teamed up with Meta to put obstacles in the way of competitors who
provide important online display advertising services to publishers.

"If one company has a stranglehold over a certain area, it can make it hard
for start-ups and smaller businesses to break into the market - and may
ultimately reduce customer choice.

"We will not shy away from scrutinising the behaviour of big tech firms while
we await powers for the Digital Markets Unit, working closely with global
regulators to get the best outcomes possible."

As this is only the start of the CMA's investigation, no decision has been
made on whether Google or Meta have broken the law.

This case follows on from the CMA's market study into online platforms and
digital advertising
(https://www.gov.uk/cma-cases/online-platforms-and-digital-advertising-market-study)
, which considered Google's position in relation to header bidding services
and the wider "ad tech stack" - of which heading bidding services is a part.
The CMA has also received complaints in relation to Google's conduct in this
area.

The government has recently proposed powers for the Digital Markets Unit which
will sit within the CMA. This unit will ultimately be responsible for deciding
which 'big tech' firms face legally enforceable codes of conduct to govern
their behaviour.

In the meantime, the CMA is pressing ahead with its probes into Apple's App
Store (https://www.gov.uk/cma-cases/investigation-into-apple-appstore) ,
Meta's use of data
(https://www.gov.uk/government/news/cma-investigates-facebook-s-use-of-ad-data)
and Apple and Google's mobile ecosystems
(https://www.gov.uk/government/news/apple-and-google-duopoly-limits-competition-and-choice)
over competition concerns. It recently accepted commitments from Google
(https://www.gov.uk/government/news/cma-to-keep-close-eye-on-google-as-it-secures-final-privacy-sandbox-commitments)
relating to its proposed removal of third-party cookies from the Chrome
browser. The CMA has adopted a joined-up approach across all related cases to
ensure the best outcomes for customers and other businesses.

Find out more about this investigation on the case page
(https://www.gov.uk/cma-cases/investigation-into-suspected-anti-competitive-agreement-between-google-and-meta-and-behaviour-by-google-in-relation-to-header-bidding)
.

Notes to Editors

1.   The competition legislation relevant to the CMA's investigation is the
Competition Act 1998. This case concerns both the Chapter I prohibition (which
makes agreements illegal where they have the object or effect of restricting
competition) and the Chapter II prohibition (which makes it illegal for a
company that holds a dominant position from behaving to the detriment of
competition).

-     For Chapter I, the case includes both Google and Meta (previously
Facebook), and the agreement between them.

-     For Chapter II, the case concerns only Google's behaviour, including
the agreement it entered into with Meta.

 

2.   The CMA may launch an investigation under the Competition Act 1998 if
it has reasonable grounds to suspect that there has been an infringement of
competition law. If the CMA decides that Google or Meta breached competition
law, it can impose a fine up to 10% of the company's worldwide turnover, as
well as issue legally binding directions to bring the breach to an end.

 

3.   "Google" refers to Google UK Limited, Google LLC and Alphabet Inc and
"Meta" refers to Facebook UK Limited, Meta Platforms Ireland Limited and Meta
Platforms, Inc.

 

4.   Ad tech is used in the sale of online advertising. A series of tools
have been developed and sold to help intermediate the sale of online
advertising between sellers (publishers, like newspapers and news websites)
and buyers (advertisers). Header bidding is a service within the ad tech stack
which emerged from around 2015 and was widely adopted. Google has a strong
position at each part of the ad tech stack. More information can be found in
the CMA's final report for its market study into online platforms and digital
advertising
(https://www.gov.uk/cma-cases/online-platforms-and-digital-advertising-market-study)
.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  IRSVFLBFLXLEBBF