Google and Meta face EU and UK probe ad auction deal

BRUSSELS — Regulators in Britain and Europe have threatened to crack down on Google and Facebook parent company Meta over an online display advertising services deal, saying on Friday the deal could breach fair competition rules.

The new control in Europe, which has pioneering efforts to rein in big tech companiesstrikes at the heart of Google’s business: the digital ads that generate almost all of its revenue.

In the “ad tech” marketplace between Google and a constellation of online advertisers and publishers, the company controls access to advertisers who serve ads on its dominant search platform. Google also manages the bidding process for advertisers to serve ads on a publisher’s site.

The European Union’s top competition watchdog has opened an antitrust probe into a 2018 pact for Meta’s Audience Network to participate in Google’s Open Bidding program.

The European Commission, the EU’s executive arm, said the deal, which Google has dubbed internally “Jedi Blue,” could be part of efforts to exclude ad tech services that compete with the Open Bidding program from Google at the expense of publishers and consumers.

The UK Competition and Markets Authority has announced a parallel investigation into the deal, which is also the subject of a state-led antitrust suit against Google it is in US courts.

Google said “allegations made about the deal are false,” calling it a “publicly documented pro-competitive agreement” allowing Facebook to participate in its Open Bidding program, along with dozens of other companies.

Meta said “the non-exclusive auction agreement with Google and similar agreements we have with other auction platforms have helped increase competition for ad placements.” Meta said it would cooperate with EU and UK investigations.

EU Competition Commissioner Margrethe Vestager said if the investigation confirms the watchdog’s suspicions, “it would restrict and distort competition in the already concentrated ad-tech market, to the detriment of ad-serving technologies. competitors, publishers and, ultimately, consumers”.

The European Commission said it intended to “cooperate closely” with the UK competition authority on the investigation.

The watchdogs are examining both the ad auction deal and whether Google abused its dominant position in the online advertising market.

“If a company has a stranglehold on a certain area, it can make it difficult for startups and small businesses to break into the market – and can ultimately reduce customer choice,” said the UK watchdog’s chief executive, Andrea Coscelli, in a statement.

Laura J. Boyer