Google is facing another investigation by the Competition and Markets Authority (CMA) amidst claims that the tech giant abuses its dominant position in the adtech industry.  

The investigation marks the third probe into Google ad practices in the space of two years, and follows a separate examination of Google and Meta’s controversial ‘Jedi Blue’ agreement – which critics claim would heavily sway ad markets in their favour.  

So what does this latest investigation mean for the tech giant? 

Google adtech investigation – Here’s what you need to know

The CMA announced it will investigate whether Google’s advertising technology deliberately favours its own services and negatively impacts third-party ad providers.  

In particular, the investigation will focus on three key areas of Google’s ‘ad tech stack’, which includes: 

• Demand-side platforms (DSPs) which allow advertisers and media agencies to purchase ad space.  
• Ad exchanges that provide the technology to automate the sale of a publishers’ inventory. These exchanges provide real-time auctions by connecting to multiple DSPs.  
• Publisher ad servers which manage a publisher’s inventory and choose which ad to display. This is based on the bids received from different exchanges and/or direct deals between advertisers and specific publishers.  

Notably, the CMA said it will assess whether Google purposefully limited the interoperability of its ad exchange platform with third-party publishers to make it more difficult for rival ad servers to compete.  

The regulator also voiced concerns that Google may have used its own publisher ad server and DPSs to “illegally favour its own ad exchange services” and exclude services offered by rivals.  

Announcing the probe, CMA Chief Executive Andrea Coscelli commented: “We’re worried that Google may be using its position in ad tech to favour its own services to the detriment of its rivals, of its customers and ultimately of consumers.  

“This would be bad for the millions of people who enjoy access to a wealth of free information online every day.”

Coscelli added: “Weakening competition in this area could reduce the ad revenues of publishers, who may be forced to compromise the quality of their content to cut costs or put their content behind paywalls.  

“It may also be raising costs for advertisers which are passed on through higher prices for advertised goods and services.”

Market dominance?

This latest investigation follows longstanding criticism that Google and other tech companies – such as Meta – are seriously inhibiting competition in the advertising space.  

A 2020 CMA report into the digital advertising industry found that “competition is not working well” in the marketplace as a result of large players dominating the landscape.  

The report deemed that this lack of competition was causing “substantial harm for consumers and society as a whole” and helped prompt the establishment of the Digital Markets Unit, which monitors the conduct of Google, Meta and other major industry players.

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