U.K. regulators slam Google's ad tech practices, as U.S. trial gets underway

The U.K.’s competition watchdog, the Competition and Markets Authority (CMA), provisionally found Google may have used anticompetitive practices in its “open-display” ad tech business and potentially harmed thousands of U.K. publishers and advertisers.

Following an investigation started two years ago, the CMA on Friday issued a statement of objections alleging that Google is abusing its market power to “hinder competition when it comes to the ads people see on websites.”

The regulator said Google used its ad tech market dominance to “self-preference” its own buying tools and publisher ad server and thus prevent publishers and advertisers from working with better, more competitive services.

“Noting they are provisional, the CMA’s findings of ongoing ‘abuse of dominant positions through the operation of both publisher ad server and buying tools to restrict competition in the U.K.’ are at odds with the best interests of our members and the advertisers they operate on behalf of,” Paul Bainsfair, director general at the Institute of Practitioners in Advertising, said in a statement provided to The Current.

Google’s latest regulatory headache comes just as the tech giant is set to face the U.S. Department of Justice in court, joined by several state attorneys general, who accuse the company of anticompetitive practices in its ad tech business.

The CMA expressed significant concerns relating to Google’s ad exchange, AdX, which sits between its buying tools (Google Ads and DV360) and its publisher ad server (DoubleClick for Publishers). The regulator alleges AdX manipulated advertiser bids “so that they have a higher value when submitted into AdX’s auction than when submitted into rival exchanges’ auctions,” among other practices.

Juliette Enser, interim executive director of enforcement at the CMA, added that it was important for advertising players to “get a fair deal when buying or selling digital advertising space.”

No regulatory action has been announced, as Google now has the opportunity to respond to the CMA before final findings are released. Potential penalties can range up to 10% of the company’s annual global revenue.

The tech giant has argued that the ad tech space is competitive, with Dan Taylor, its VP of global ads, saying that “the core of this case rests on flawed interpretations of the ad tech sector. We disagree with the CMA’s view and we will respond accordingly.”

European regulators, meanwhile, are busy investigating Google’s ad tech practices. In addition, a group of more than 30 European publishers also filed a lawsuit against Google in February this year, over alleged losses in their businesses due to the tech giant’s “abuse of its dominant market position.” In June, another multi-billion dollar claim against Google brought on behalf of U.K. publishers was allowed to progress to trial.

Separately, a U.S. federal judge ruled earlier this year that Google illegally maintained a monopoly in its search business.

The Current is owned and operated by The Trade Desk Inc. An individual from The Trade Desk is among the 68 people included on the trial witness list.