Meta Platforms Inc. and Alphabet Inc.’s Google face European Union and U.K. antitrust probes into possible collusion over the way they operate online display advertising services.
The European Commission and the U.K.’s Competition and Markets Authority said they’re concerned about a pact between the two tech giants. Dubbed “Jedi Blue,” it could squeeze competitors out of the market for ads on publisher websites and apps.
Watchdogs around the world have started to home in on the power firms like Google and Meta’s Facebook wield over ad markets — striking the tech giants’ money-making machines. The EU and U.K. probes announced Friday echo allegations in the U.S.
“Many publishers rely on online display advertising to fund online content for consumers,” EU Competition Commissioner Margrethe Vestager said. If the EU’s concerns are confirmed “it would restrict and distort competition in the already concentrated ad tech market, to the detriment of rival ad serving technologies, publishers and ultimately consumers.”
The EU has previously fined Google more than $9 billion for other alleged antitrust infractions. Meta is also being probed over suspicions it misused a trove of data gathered from advertisers to compete against them in classified ads.
Unlike smaller ad-tech companies, Google owns major pieces of the online ad market. It runs an ad-buying service for marketers and an ad-selling one for publishers, as well as a trading exchange where both sides complete transactions in lightning-fast auctions.
These exchanges operate like online stock-trading platforms with an automated bidding process. Competitors and publishers have complained that Google leverages parts of this vast network, like its ad exchange. They argue this is done to benefit other areas and kneecap rivals.
The U.K.’s CMA said in a separate statement that it’s investigating whether “Google’s conduct may have affected the ability of other firms to compete with its header bidding product.”
Both watchdogs will “closely cooperate,” the EU said.
Google rejected the arguments made by both watchdogs as “allegations” that are “false.”
“This is a publicly documented, pro-competitive agreement that enables Facebook Audience Network to participate in our Open Bidding program, along with dozens of other companies,” Google said in a statement.
The participation of Meta’s Facebook “helps” reach the program’s goal of working with ad networks and exchanges. This is “to increase demand for publishers’ ad space, which helps those publishers earn more revenue,” said Google.
Meta said its “non-exclusive bidding agreement with Google and the similar agreements we have with other bidding platforms, have helped to increase competition for ad placements.” It added that the company will “cooperate with both inquiries.”