European Union regulators are preparing to fine Google for anti-competitive practices in its adtech business, but they are unlikely to follow through on earlier threats to break up the tech giant's lucrative advertising operations.
The decision, expected in the coming months, comes after EU antitrust chief Margrethe Vestager had warned that Google might face its harshest regulatory penalty yet—a forced divestiture of parts of its adtech empire. However, a Reuters report mentioned that the complexity of such a move has led officials to reconsider.
The European Commission’s investigation into Google centers on accusations that the company has unfairly favored its own ad exchange, AdX, over competitors in digital advertising auctions since 2014.
Google’s dominance in the digital ad space, where it controls key tools on both the buying and selling sides of transactions, has raised concerns about conflicts of interest. Vestager had previously suggested that Google might need to sell its sell-side tools, such as DoubleClick for Publishers (DFP) and AdX, to resolve the issue, but regulators are now expected to settle for financial penalties rather than an immediate breakup.
Although the threat of a breakup has been tabled for now, it remains a possibility in the future if Google continues to engage in anti-competitive behaviour. The precedent for such an outcome can be seen in a landmark case involving Microsoft two decades ago, where regulators eventually pursued a more severe penalty after continued violations. The European Commission’s decision, though not finalised, could change course before Vestager leaves office in November.
Google has already accumulated EUR 8.25 billion (USD 9.14 billion) in EU antitrust fines over the past decade. The company’s advertising business is a critical part of its overall operations, generating USD 237.85 billion in 2023, accounting for 77 per cent of its total revenue. Meanwhile, Google faces similar challenges in the United States, where it is currently on trial for allegedly attempting to monopolise digital advertising markets through its control of ad servers, ad networks and exchanges.
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