EU fines Google another $1.7 billion for 'abusive' contracts with AdSense publishers
Google has been fined a cumulative total of about $9.3 billion and another potential case is pending.
Google is facing its third fine important antitrust in the EU. This time, the company was penalized 1.49 billion euros ($1.69 billion) for "abusive practices in online advertising" involving publisher contracts around AdSense for search.
The fine "takes into account the duration and gravity of the infringement... . [and] was calculated on the basis of the value of Google's revenue from advertising intermediation for online searches in the EEA," according to the press release from the European Commission (EC).
Over $9 billion in fines. Last year, Google was fined 4.3 billion (approximately $5 billion) resulting from Google Play app pre-installation contracts with phone manufacturers. And in 2017, Google was fined €2.4 billion ($2.7 billion) for favoring its own content in shopping search results.
The three formal antitrust complaints resulted in heavy fines, totaling 8.2 billion euros ($9.3 billion). Google has appealed the two previous fines and will likely appeal this one.
Abusive contracts The EC stated that the exclusivity clauses in the Google AdWords agreements (" AdSense for Search") with third-party publishers prohibited them from using competing services and limited how publishers could display ads from Google's rivals.
Antitrust Commissioner Margrethe Vestager issued the following statement on the occasion of the decision:
"Today, the Commission fined Google €1.49 billion for unlawful abuse of its dominant position in the online search ad brokerage market. Google consolidated its dominant position in the online search ad market and protected itself from competitive pressure by imposing anti-competitive contractual restrictions on third party websites. This practice is illegal under EU antitrust rules. This reprehensible behavior has gone on for more than 10 years and has deprived other companies of the opportunity to compete on the merits and innovate - and consumers of the benefits of competition."
The EC said Google's agreements made it difficult for Microsoft or Yahoo to compete for publishers' business.
This is where private prosecutions come in. Google amended the agreements in 2016, when the formal antitrust complaint was issued. As a result, the litigious behavior ended. However, the EC states that Google may now face civil actions for damages "by any person or business affected by its anticompetitive conduct."
A series of lawsuits from publishers and others can be expected. Google is also facing a fourth potential antitrust case involving local search, which has not yet been officially declared.
Why you should care. Margrethe Vestager's term as Europe's antitrust chief ends this year, and it is unlikely that she will be reappointed. However, before she leaves, I expect a fourth statement of objections (formal charges) to be filed against Google in the area of local search, which will likely result in another large fine. The logic is virtually identical to the shopping search case that resulted in a $2.7 billion penalty.
Together, these fines and findings are putting increasing pressure on U.S. officials to take further action against Google, despite the closure of the 2013 FTC antitrust case without significant penalties.