A day after Google managed to get into hot waters with the Competition Commission of India (CCI), the tech titan has now been sued by Canada’s Competition Bureau. The law enforcement agency is alleging that Google abused its dominant position in the online advertising market to stifle competition and solidify its control.
The case was filed with Canada’s Competition Tribunal. This development comes four years after the Competition Bureau began its investigation (and a few months after it was expanded). The Bureau eventually concluded that the tech titan abused its dominance to undermine rivals and restrict competition by manipulating its ad tech tools to favor its own services, locking advertisers and publishers into its ecosystem while disadvantaging competing platforms.
These actions, according to the lawsuit, allowed Google to strengthen its foothold in the market at the cost of Canadian advertisers, publishers, and consumers. To be precise, Google is accused of tying its ad server, DoubleClick for Publishers (DFP), with its ad exchange platform, AdX, to gain an unfair advantage in ad auctions. In a statement, the Bureau added that Google also provided preferential access to ad inventory to its own tools, as well as influenced market dynamics to take negative margins at times, amongst other things.
“The Competition Bureau conducted an extensive investigation that found that Google has abused its dominant position in online advertising in Canada by engaging in conduct that locks market participants into using its own ad tech tools, excluding competitors, and distorting the competitive process. Google’s conduct has prevented rivals from being able to compete on the merits of what they have to offer, to the detriment of Canadian advertisers, publishers and consumers. We are taking our case to the Tribunal to stop this conduct and its harmful effects in Canada,” Matthew Boswell, Canada’s Commissioner of Competition, commented on the development.
For now, the Competition Bureau is seeking three key remedies from the Tribunal. First, Google has to divest its DFP ad server and AdX exchange, as well as pay a penalty amounting to 3% of Google’s global revenue, which could reach billions, to ensure its compliance with the Competition Act. Furthermore, the Tribunal should prevent the tech behemoth from engaging in similar anti-competitive practices in the future.
For its part, Google has rejected the allegations, arguing that the online advertising market is highly competitive. “Our advertising technology tools help websites and apps fund their content, and enable businesses of all sizes to effectively reach new customers,” Dan Taylor, VP of Global Ads, Google said in a statement. He added that the lawsuit “ignores the intense competition where ad buyers and sellers have plenty of choice,” and that the company’s adtech tools “help websites and apps fund their content, and enable businesses of all sizes to effectively reach new customers.”
