Google dominance in Australia online advertising harms business

Google dominates Australia’s online advertising market to the point of harming publishers, advertisers and ultimately consumers, ACCC, the country’s antitrust regulator said.
Google developers
A report by the Australian Competition and Consumer Commission (ACCC) said more than 90 percent of clicks on advertisements traded through the Australian ad tech supply chain passed through at least one service owned by Alphabet’s Google in 2020.

What ACCC said

Google’s dominance in the ad tech supply chain is underpinned by multiple factors including its access to consumer and other data, access to exclusive inventory and integration across its ad tech services. Key acquisitions by Google, including of DoubleClick in 2007, AdMob in 2009, as well as YouTube in 2006 have helped Google entrench its position in ad tech.

Google has used its position to preference its own services and shield them from competition. For example, Google prevents rival ad tech services from accessing ads on YouTube, providing its own ad tech services with an important advantage.

Google has also refused to participate in publisher-led header bidding, an industry innovation aimed at increasing competition for publishers’ inventory, and previously allowed its services to have a ‘last look’ opportunity to outbid rivals.

“Google has used its vertically integrated position to operate its ad tech services in a way that has, over time, led to a less competitive ad tech industry,” ACCC Chair Rod Sims said in a statement, released alongside the report.

A Google spokesman was not immediately available for comment. In a blogpost published soon before the ACCC’s report, Google said its advertising technology supported more than 15,000 Australian jobs and contributed $2.45 billion a year to the country’s economy annually.

The ACCC said the U.S. company benefited from vast amounts of internet user data from its search engine, mapping and YouTube video streaming services, and must be more transparent about the way it uses this information to sell advertisements.

The regulator said it wanted special powers to address the imbalance of advertiser access to consumer data, such as rules forcing them to separate data between business units or share data with competitors.

The “ad tech” report was part of the ACCC’s wider examination of online platforms which earlier this year prompted Google to say it might withdraw core services from the country over laws forcing it to pay for media content that drives traffic to its website.

Google has since announced content payment deals with most of Australia’s largest media outlets. Social media giant Facebook cut news feeds in the country for a week in the days before the law was passed.