TORONTO — Canada’s Competition Bureau announced on Thursday that it is initiating legal action against Google, accusing the tech giant of engaging in anti-competitive practices within its online advertising sector. The bureau is requesting that the company divest two of its advertising technology services and face potential financial penalties.
According to the Competition Bureau, an investigation revealed that Google had unlawfully integrated its advertising technology tools to uphold its dominant status in the market. The case will be brought before the Competition Tribunal, which is a specialized judicial body responsible for addressing cases related to violations of the Competition Act.
The bureau’s legal request seeks to compel Google to divest its publisher ad server, known as DoubleClick for Publishers, as well as its ad exchange, AdX. The bureau’s analysis indicates that Google commands a dominant market share of approximately 90% in the publisher ad server segment, 70% in advertiser networks, 60% in demand-side platforms, and around 50% in the ad exchange market.
Such market dominance, according to the bureau, has stifled competition from other players, hindered innovation, resulted in higher advertising expenses, and decreased revenue for publishers. Matthew Boswell, the Commissioner of Competition, asserted in a statement that Google has exploited its dominant position in Canada’s online advertising market by engaging in practices that compel market participants to rely solely on its own advertising technology, thereby sidelining competitors and disrupting the competitive framework.
In response, Google contends that the online advertising industry remains highly competitive. Dan Taylor, Google’s vice president of global ads, stated that the bureau’s accusations overlook the reality of vigorous competition, emphasizing that both advertisers and publishers have numerous options available to them. The company has expressed its intention to robustly contest the allegations presented against it.
Additionally, in a separate context, U.S. regulators are advocating for a federal judge to disband Google’s operations to mitigate its ability to suppress competition through its dominant search engine. This move follows a court’s determination that Google has maintained an abusive monopoly for the last ten years.
The proposals for this potential breakup were detailed in a 23-page document submitted this month by the U.S. Department of Justice, which suggests drastic measures, including the sale of Google’s leading Chrome web browser, as well as measures to prevent its Android operating system from favoring its own search engine services.