The Competition Bureau is taking legal action against Google for anti-competitive conduct in online advertising technology services in Canada. Following a thorough investigation, the Bureau has filed an application with the Competition Tribunal that seeks to remedy the conduct for the benefit of Canadians.
This case is about online web advertising, which consists of ads shown to users when they visit websites. Many publishers count on digital ad revenue to support their activities and reach. Digital ad inventory is often purchased and sold through automated auctions using sophisticated platforms. These individual platforms are known as ad tech tools while the entire suite of tools used throughout the buy and sell process are collectively known as the ad tech stack.
The Bureau's investigation found that, in Canada, Google is the largest provider across the ad tech stack for web advertising and has abused its dominant position through conduct intended to ensure that it would maintain and entrench its market power. Google's conduct locks market participants into using its own ad tech tools, prevents rivals from being able to compete on the merits of their offering, and otherwise distorts the competitive process.
In particular, the Bureau found that Google has:
- unlawfully tied its various ad tech tools together to maintain its market dominance; and
- leveraged its position across these ad tech tools to distort auction dynamics by:
- giving its own tools preferential access to ad inventory,
- taking negative margins in certain circumstances to disadvantage rivals, and
- dictating the terms on which its own publisher customers could transact with rival ad tech tools.
The Bureau's position is that by implementing this anticompetitive conduct, Google has been able to entrench its dominance, prevent rivals from competing, inhibit innovation, inflate advertising costs and reduce publishers' revenues.
The Bureau's application with the Competition Tribunal seeks an order that, among other things:
- requires Google to sell two of its ad tech tools;
- directs Google to pay a penalty to promote compliance with the Competition Act; and
- prohibits Google from continuing to engage in anticompetitive practices.
The final decision in this matter rests with the Competition Tribunal.
