Google has made a formal response to the European Union’s (EU) threat to break up its profitable advertising technology (ad tech) arm, calling the allegations “flawed.”
The EU’s competition chief, Margrethe Vestager, said in June that the only way to restore competition in the sector was for Google to spin off its ad tech business, Bloomberg reported Friday (Dec. 8).
However, Google opposed this call for divestment in a formal response delivered this week, according to the report.
“While we continue our constructive conversations with the Commission, we are opposing the call for divestment, as we don’t believe it is proportionate nor the right solution for our partners,” Dan Taylor, vice president for global ads at Google, said in the report.
The European Commission said in June that a preliminary investigation suggests that Google abused its dominance in the online advertising space by favoring its own ad tech.
“Our investigation has shown that Google may hold a dominant position on both ends of the ad tech supply chain,” Vestager said in a news conference after the EC’s charges were announced. “There is nothing wrong with being dominant as such. What our investigation has shown though, is that Google appears to have abused its market position.”
It was reported in October that Google intended to challenge the EU’s threat to break up its ad business.
Earlier, in a June blog post addressing the EC’s statement of objections, Taylor said the online advertising market is already competitive.
“The digital advertising market enjoys competitive pricing, lively innovation and robust competition — helping advertisers, publishers and consumers,” Taylor said in the post. “We look forward to showing how our ad tech tools help make the internet open, and accessible — and how breaking them would diminish the availability of free, ad-supported content that benefits everyone.”
Google has been under scrutiny by the EU for several years and has already been fined 8.3 billion euros ($8.9 billion) for abuses of dominance in its mobile operating system and display advertising operations, according to the Bloomberg report.
The company is appealing all of those fines, the report said.
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