The EU and the United Kingdom have launched an antitrust probe into Google and Meta’s adtech transactions.
Google and Meta are being probed by antitrust regulators in the EU and the United Kingdom for “Jedi Blue,” a contract between the two corporations that opponents believe allowed them to prevent smaller tech businesses from entering the internet ad industry.
The European Commission expressed worry in a press statement that the September 2018 arrangement “may constitute part of attempts to exclude ad tech providers competing with Google’s Open Bidding programme, and thereby restrict or distort competition in markets for online display advertising.” As a result, it has launched a formal antitrust probe.
The UK’s Competition Market Authority said it was also looking into the arrangement, with CMA chairman Andrea Coscelli saying, “We’re worried that Google may have collaborated with Meta to obstruct rivals that supply crucial online display advertising services to publishers.”
The Jedi Blue transaction is already being investigated in the United States, with 15 state attorneys general filing complaints against the two corporations. These several legal fronts have resulted in a gradual flow of information regarding both the agreement and the prosecutors’ claims. According to court documents, key officials at Google and Meta, including Sundar Pichai, Sheryl Sandberg, and Mark Zuckerberg, evaluated and approved Jedi Blue.
The roots of Jedi Blue are commonly traced back to a 2017 decision by Meta (formerly Facebook) to create an ad tech system that would compete with Google’s. According to lawsuits filed in the United States, Meta stopped its support for the technology in 2018 when Google provided the business preferential access to its online ad auction system. As part of the agreement, Meta was given first priority when purchasing ad real estate from Google, and it agreed to halt investing in competitor ad tech platforms.
It’s a lengthy tale, but the end result, according to US prosecutors, is that the two corporations collaborated to save money and keep off competitors.
“WE HAVE NOT DETERMINED YET IF THIS IS A GOOGLE THING ALONE OR IF THEY WERE IN IT TOGETHER.”
Although regulators are looking into both Meta and Google, the European Commission believes that only Google is to blame. The EU’s competition commissioner, Margrethe Vestager, told The Flaunt Weekly, “We have not yet established whether it is a Google thing alone or if they were in it together.” It’s not a given that Meta was aware of the consequences of the arrangement, and that’s what we need to look into.”
The EU and UK probes, according to Meta and Google, are wrong.
“The claims made concerning this arrangement are baseless,” Google stated in a statement. This is a publicly publicised, procompetitive arrangement that allows Facebook Audience Network (FAN), along with dozens of other organisations, to participate in our Open Bidding programme.”
“Meta’s non-exclusive bidding deal with Google, as well as the comparable partnerships we have with other bidding platforms, have helped to improve competition for ad placements,” Facebook subsidiary Meta said in a statement.
If Meta or Google are found to have violated EU competition legislation, they might face fines of up to 10% of their global yearly turnover. However, the probe is expected to take years to complete, giving both corporations enough chances to challenge any findings.
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