On June 7, Isabelle de Silva, a little-known French regulator, has made headlines in global headlines. After a painstaking investigation, which de Silva describes as the most complex in which she was involved, she was hit by the French Competition Agency or the FCA Google with a fine of $ 260 million. Google, de Silva ruled, used its already dominant advertising technology to further strengthen its position and outperform the competition.
But de Silva was not done. A month later, in another case, she punished Google again. This time, Google was unable to negotiate copyright changes to its search results with media organizations. Google’s punishment? A fine of $ 594 million.
Such amounts are a small change for Google and its parent company Alphabet, which made it $ 61.9 billion in the last quarter alone. But the FCA’s decision on Google’s advertising technology took the headlines for another reason: Google didn’t fight it. The company agreed with all the facts in the case of the FCA and agreed to make significant changes in the way it works. And these changes will not only happen in France, but all over the world.
With one ruling, the regulator, known as the Autorité de la Concurrence in French, managed to reshape the way Google’s advertising technology works. The ruling applies to technologies within Google Ad Manager – a platform that helps companies buy and sell ads that appear on billions of websites. The FCA had a particular problem with two elements of the Ad Manager system: the DoubleClick for Publishers ad server and the sales platform known as SSP AdX. The first allows website owners to sell ads around the content they publish, while the second is involved in controlling a complex auction process in a split second.
“Google has ensured that the ad server favors a platform to sell ad space,” de Silva says. In addition, she explains, Google has used its knowledge of what happened on other ad platforms to its advantage by reducing its own prices. “We were able to show in detail that Google not only has information that others did not have, because of its specificity [dominant] position, but that they used this information effectively to have a better chance of winning the bids, ”says de Silva.
In short, Google has used its power to give itself an advantage. Under competition law in Europe, companies that have a dominant position in the market are not allowed to abuse their position. Technical giants are allowed to be big, but they should not use this power to strengthen at the expense of rivals. Publishers of websites that sell their advertising space have lost because of Google’s behavior, the FCA has decided. Google’s rivals in the advertising technology space have also suffered because of Google’s actions.
Earlier, three European Commission investigations fined Google more than $ 9.7 billion for anti-competitive behavior, and the company is challenging those fines in court. But in this case, Google is not challenging the FCA’s decision. In fact, this did not challenge the FCA’s findings, and suggested changes to the advertising technology itself. (It also made some changes in response to European Commission cases.)
“This is the first decision in which technical giants, and Google in particular, have taken such drugs to solve the case,” says Fayrouze Masmi-Dazi, a competition law partner at French firm Frieh Associés that was not involved in the Google holster. “This is a very important decision. I think this shows that the French competition authority is both very pragmatic and creative in terms of the solutions that can be found to solve the problem. ”
“The decision is completely transparent,” says Antoine Riquier, a commercial litigant at law firm Hausfeld. The FCA decision on 101 pages is cluttered with diagrams that explain how ad technology bidding and servers work. “You have a lot of details, but they’re not too technical at the same time. The French competition authorities are putting a lot of effort into this. ”