In a preliminary report into Google’s alleged anti-competitive practices, the European Union says it believes breaking up the company could be essential.
The European Commission has been investigating Google’s ad business, and specifically its market dominance, since 2021. Following its preliminary report, the EU has now sent Google a statement of objections.
“The Commission preliminarily finds that, in this particular case, a behavioural remedy is likely to be ineffective to prevent the risk that Google continues such self-preferencing conducts or engages in new ones,” says the EU Commission in a statement
In other words, the EU does believe that Google’s advertising business is anti-competitive — and that Google will not voluntarily change that.
“The Commission’s preliminary view is therefore that only the mandatory divestment by Google of part of its services would address its competition concerns,” continues the statement.
“Google has a very strong market position in the online advertising technology sector,” says Margrethe Vestager, the EU’s Executive Vice-President in charge of competition policy. “It collects users’ data, it sells advertising space, and it acts as an online advertising intermediary.”
“So Google is present at almost all levels of the so-called adtech supply chain,” she continued. “Our preliminary concern is that Google may have used its market position to favour its own intermediation services.”
“Not only did this possibly harm Google’s competitors but also publishers’ interests, while also increasing advertisers’ costs,” said Vestager. “If confirmed, Google’s practices would be illegal under our competition rules.”
Vestager and the European Commission are careful to state that the investigation’s conclusions are preliminary. Google now has the opportunity to respond to the statement of objections, and there will be a hearing to discuss those.
There is not as yet, though, a specific schedule for what can happen after that. If it finds Google guilty of anticompetitive practices, the EU can fine the company up to 10% of its global sales — or potentially force it to be broken up.
If Google is to be fined, it’s far from the first time the EU has done so.
