EU and UK regulators have launched investigations into an ad-tech agreement between the two major names in online advertising.
The European Commission has announced a formal investigation into possible anticompetitive conduct by Google and Meta in online display advertising.
This will investigate an agreement between the two companies from September 2018, code-named ‘Jedi Blue’, which concerned the participation of Meta’s Audience Network in Google’s Open Bidding programme.
Open Bidding allows for the real-time auctioning of display ad space on sites and apps. The Meta Audience Network (formerly Facebook Audience Network) participates in such auctions using services such as Open Bidding.
The EU’s concern is that the Jedi Blue deal between the two companies may have targeted the exclusion of a rival ad auctioning service.
“Via the so-called Jedi Blue agreement between Google and Meta, a competing technology to Google’s Open Bidding may have been targeted with the aim to weaken it and exclude it from the market for displaying ads on publisher websites and apps,” said Margrethe Vestager, the European commissioner in charge of competition policy.
“If confirmed by our investigation, this would restrict and distort competition in the already concentrated ad-tech market, to the detriment of rival ad-serving technologies, publishers and ultimately consumers,” she added.
The UK’s Competition and Markets Authority (CMA) raised the same concerns as it launched a parallel probe. “We’re concerned that Google may have teamed up with Meta to put obstacles in the way of competitors who provide important online display advertising services to publishers,” said CMA chief executive Andrea Coscelli.
The CMA’s case follows a market study on online platforms and advertising, which examined Google’s ad-tech and bidding services as well as antitrust complaints.
Its investigation will also consider whether Google affected competition in the ad-tech market through the Jedi Blue deal, and whether both companies restricted or prevented the uptake of rival ad-tech services.
The CMA is investigating whether Google’s auctioning services abuse a dominant position more broadly or have gained an unfair advantage over competitors.
“If one company has a stranglehold over a certain area, it can make it hard for start-ups and smaller businesses to break into the market – and may ultimately reduce customer choice,” said Coscelli.
The European Commission has said it is conducting an in-depth investigation “as a matter of priority” and has been in contact with the UK regulator to cooperate.
The Jedi Blue deal is also the subject of a complaint in Texas and other US states.
Reuters reports that Google responded to the latest investigations with a statement saying: “The allegations made about this agreement are false.”
Google said Jedi Blue is a “publicly documented, pro-competitive agreement” with Meta’s Audience Network, which allows it to participate in Open Bidding along with “dozens of other companies”.
Meta also issued a statement saying that 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”.
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