Google and Facebook under investigation again for advertising market power

This time it's the UK leading the probe.

Corinne Reichert Senior Writer

Corinne Reichert (she/her) grew up in Sydney, Australia and moved to California in 2019. She holds degrees in law and communications, and currently oversees the CNET breaking news desk for the West Coast. Corinne covers everything from phones, social media and security to movies, politics, 5G and pop culture. In her spare time, she watches soccer games, F1 races and Disney movies.

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Corinne Reichert

July 3, 2019 1:45 p.m. PT

2 min read

Under probe again for market power

Olly Curtis/Future Publishing via Getty Images

The UK's Competition and Markets Authority has kicked off a probe into digital advertising and online platforms. Its examination will focus on Facebook and Google in particular, the agency said Wednesday.

A similar study in Europe resulted in Google being hit with a $1.7 billion fine in March for "abusive" online ad practices. The European Commission had said Google was exploiting its dominance by restricting its rivals from placing their search ads on third-party websites. Last year, the EU also fined Google $5 billion for antitrust practices across its mobile OS Android.

"Two suppliers in particular, Google and Facebook (PDF) (and their respective subsidiaries, such as YouTube and Instagram) hold leading positions in the market for online advertising in the UK, with the majority of digital advertising revenue in the UK split between these two businesses," the study's statement of scope (PDF) says. "Digital advertising comprises the substantial majority of the revenues of both of these companies."

Tech giants and antitrust

Spotted earlier by the Guardian, the Competition and Markets Authority's (CMA's) market study will focus on three main areas of potential harm to consumers: How much market power online platforms have; whether consumers can and will control how data about them is used and collected by online platforms; and whether digital advertising market competition could be "distorted" by some players with power.

The CMA is open to comments from groups including government, advertisers, publishers, ad tech companies, consumer groups and online platforms until July 30. It will then decide whether to make a market investigation reference by Jan. 2, 2020, with a deadline for its final report to be published on July 2, 2020.

Facebook and Google didn't immediately respond to requests for comment.

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Google is also currently under investigation by the EU over how it collects personal data for the purpose of online advertising. In 2017, the EU additionally fined Google $2.7 billion for its abusing its search dominance for shopping services.

Meanwhile, in the US, the Department of Justice is investigating Silicon Valley's tech juggernauts over whether they're engaging in "anticompetitive conduct." The investigation was announced June 3 after reports emerged May 31 that the DOJ would be preparing a Google antitrust investigation. It was followed by reports of an Apple antitrust probe. Facebook was then made part of the investigation announcement, as well as Twitter.

"The growth of monopoly power across our economy is one of the most pressing economic and political challenges we face today," Rep. David N. Cicilline, a Democrat from Rhode Island and chairman of the House Antitrust Subcommittee, said at the time.

"Market power in digital markets presents a whole new set of dangers."