Australia’s antitrust regulator calls for curbs on Google’s dominance in adtech space

2021 continues to be a tough year for tech giants as countries across the globe are slowly but steadily putting them under the scanner and even restricting them from blatantly flouting laws. Google is one such powerhouse, and the latest report by the Australian Competition and Consumer Commission (ACCC), the nation’s antitrust regulator, has placed the company in more hot waters.

The ACCC concluded that new laws needed to be set up to counter and curb Google’s dominance in the adtech sector and that its dominance harmed publishers, advertisers, and consumers. This report is part of a much larger five year inquiry into the actions and practices of online platforms.

Google and Australia have had a rocky relationship in recent times, and the latest development comes months after the company had contested Australia’s new content licensing law.

The dominance of Google in adtech is evident through the statistics presented in the report – more than 90% of Australia’s A$2.8 billion open display advertising involved at least one Google service in 2020. In fact, Alphabet’s Google used its vertically integrated position to operate its ad tech services in a manner that has led to a less competitive adtech industry. Its acquisitions of DoubleClick, AdMob, and YouTube have also helped to establish and maintain its dominance.

“We have identified systemic competition concerns relating to conduct over many years and multiple adtech services, including conduct that harms rivals. Investigation and enforcement proceedings under general competition laws are not well suited to deal with these sorts of broad concerns, and can take too long if anti-competitive harm is to be prevented,” said ACCC chair Rod Sims in a statement. While the ACCC was considering taking action against Google, the regulator failed that the existing competition laws were “not well suited” to deal with the issue.

This dominance leads to the lack of competition and subsequently higher adtech fees. This is likely to reduce the quality or quantity of online content and ultimately result in consumers paying more for advertised goods, the ACCC felt.

Apart from new laws, the ACCC calls for more transparency in the sector and the establishment of standards to enable “full and independent verification of the services advertisers use in the supply chain.”

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