Playing both sides: Regulators aren't happy with Google's ad practices

Not yet a subscriber? Sign up free below.

The view from Brussels

The European Commission has charged Google with abusing its dominant position in the advertising tech industry, mirroring a similar lawsuit filed by the US DoJ back in January.

The EC alleges that Google has exploited its control on both the buy side, assisting advertisers in securing ad placements, and the sell side, helping publishers fill their available ad space. Essentially, putting the company in a position to dictate the meeting point of demand and supply.

Even though the charges relate to only a small part of Google's business, the prevailing view from Brussels is that a “structural remedy” is the best solution. That could see Google have to carve off parts of its behemoth ad business.

All about ads

Indeed, despite its many marvelous pieces of technology — Google Earth, its self-driving car project, Google Cloud — Alphabet still makes the vast majority of its revenue in the very same way that this humble newsletter does: advertising. Through serving billions of ads across Google Search, YouTube and the wider Google Network, Alphabet brought in a staggering $224bn in ad revenue last year — nearly 80% of the company’s total.

Google's dominance in the advertising realm is admittedly gradually diminishing. It currently captures 27% of all digital advertising revenue in the US — still the most of any company, but down from its 37% share in 2015. Meta holds the second position, but has seen a similar squeeze in its share — most notably from Amazon, which has quickly captured ~12% of the US market, as shoppers increasingly start their search for products on Amazon itself.

Not yet a subscriber? Sign up free below.


Stories from this newsletter

Bridging the gap: At a global level, income inequality continues to fall
Playing both sides: Regulators aren't happy with Google's ad practices
Web of language: English dominates the internet
We and our partners use cookies and similar technologies (“Cookies”) on our website and in our newsletters for performance, analytical or advertising purposes to ensure you have the best experience on our site and/or interaction with us. To find out more about the use of Cookies, see our Cookie Notice. Please click OK if you consent to our use of Cookies or click Manage my Preferences to manage your Cookie preferences.