PREMIUM: Margarethe Vestager European Competition Comission

Source: CNBC

The EU’s commissioner for competition, Margrethe Vestager, said Wednesday that Google must pay 1.49 billion euros ($1.69 billion) for stifling competition in the online advertisement sector.

Google’s Adsense pushes ads triggered by search engines embedded websites. Rival firms to Google had claimed the product was placed on websites with the understanding that no other systems could be on the same page.

Speaking in Brussels Wednesday, the EU’s competition commissioner Margrethe Vestager said Google had prevented rivals from being able to “compete and innovate fairly” in the online ad market.

“Google has cemented its dominance in online search adverts and shielded itself from competitive pressure by imposing anti-competitive contractual restrictions on third-party websites. This is illegal under EU antitrust rules,” said Vestager.

The Alphabet company has previously defended its use of the technology, claiming it has been in place since 2006, is now superseded, and is a minor product.

In the fourth quarter of 2018, Google’s core advertising business saw revenue increase 20 percent from the previous quarter to $32.6 billion — the same rate of growth as the last quarter.

The European Commission said between 2006 to 2016 Google was by far the strongest player in online search advertising in the European Economic Area (EEA), with a market share above 70 percent.

EU versus Google

It is the third antitrust fine from Brussels to land on Google’s desk.

Last July, regulators in Brussels hit the Alphabet unit with a $5 billion fine for abusing the dominance of its Android mobile operating system.

In a blog post Tuesday Google’s SVP of Global Affairs, Kent Walker, wrote that European Android customers will now be asked which apps they would like to use instead.

In 2017 Google, received a $2.7 billion penalty from the EU for favoring its shopping service over competitors.

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