Google has appealed the $1.7bn (€1.49bn, £1.32bn) fine set by the European Commission for strangling rival advertising networks with the firm grip of its dominant search platform.
Through AdSense for Search, Google provides these search adverts to owners of “publisher” websites. Google is an intermediary, like an advertising broker, between advertisers and website owners that want to profit from the space around their search results pages. Therefore, AdSense for Search works as an online search advertising intermediation platform.
Google was by far the strongest player in online search advertising intermediation in the European Economic Area (EEA), with a market share above 70% from 2006 to 2016. In 2016 Google also held market shares generally above 90% in the national markets for general search and above 75% in most of the national markets for online search advertising, where it is present with its flagship product, the Google search engine, which provides search results to consumers.
It is not possible for competitors in online search advertising such as Microsoft and Yahoo to sell advertising space in Google's own search engine results pages. Therefore, third-party websites represent an important entry point for these other suppliers of online search advertising intermediation services to grow their business and try to compete with Google.
The European Commission thus found that Google stifled competition. At one point, the Chocolate Factory decided that adverts from other networks were allowed onto its AdSense for Search platform, though publishers had to place Google's ads prominently on their websites. Competing ad networks were therefore relegated to less favorable positions on pages, and so received fewer impressions and clicks. Publishers also had to obtain written approval from Google before they could make any changes to the way adverts were placed on their websites as part of their contracts.
Now Google has retaliated, and challenged the European Commission’s findings by filing an appeal to the General Court of the European Union in Brussels, as first reported by The Telegraph.
The €1.49bn fine was the search and ad slinger's third penalty for breaking EU monopoly laws. There are two others cost the US titan about $5bn (€4.3 bn) for market abuse via its Android platform, and $2.7bn (€2.4 bn) over its Google Shopping service.
Google was not immediately available for comment. The European Commission said it would "defend" its fine in court. ®
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