13-6-2023 (BRUSSELS) European Union antitrust regulators are considering the possibility of ordering Alphabet Inc’s Google to divest a portion of its advertising-technology business, according to a source familiar with the matter who spoke to Reuters on Monday.
The European Commission, the EU’s leading antitrust authority, may file a formal complaint against Google as early as Wednesday, heightening the ongoing efforts on both sides of the Atlantic to curb the tech giant’s dominance in the digital advertising market.
In 2022, the Commission initiated an investigation into Google’s extensive presence across various levels of the online display advertising supply chain, expressing concerns about its overwhelming market position.
It is uncommon for the EU competition regulator to issue breakup orders. However, frustration has mounted as Google has failed to address competition issues, stated the source.
Both the European Commission and Google have not yet responded to Reuters’ requests for comment on the matter.
Google currently holds the largest share of the global digital advertising market, accounting for 28 percent of global ad revenue, according to research firm Insider Intelligence.
While Alphabet’s first-quarter ad sales in 2023 declined from the previous year to $54.55 billion, they surpassed analysts’ expectations. The parent company of Google reported total revenue of $69.79 billion during the same period.
Over the past few years, Google’s dominance in online advertising has faced increasing scrutiny. Complaints from competitors regarding its allegedly anti-competitive practices have led to antitrust investigations across multiple continents.
Earlier this year, the United States filed an ad tech lawsuit against Google, demanding the divestiture of its ad manager suite. The lawsuit claimed that the search giant had illegally exploited its dominance in online advertising. Google has consistently denied any wrongdoing.
