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Google slammed $1.7bn fine for blocking ad rivals

Ladesope Ladelokun with agency report

Search and advertising giant, Google, has been slammed with a $1.7 billion fine by European Union regulators for blocking online search advertisers.

The regulators accused Google of gross abuse of its market dominance by restricting third-party rivals from displaying search ads from 2006 to 2016. The latest fine is the third Google has attracted in the last two years.

In 2017, EU regulators fined Google €2.42 billion for hindering rivals of shopping comparison websites. Last year, the EU competition authority slammed Google with €4.34 billion fine for using its popular Android mobile operating system to block rivals.

Google had changed its Adsense contracts with large third parties, giving them the opportunity to show competing search adverts.

“Google has cemented its dominance in online search adverts and shielded itself from competitive pressure by imposing anti-competitive contractual restrictions on third-party websites. This is illegal under EU anti-trust rule”, said EC Commissioner Margrethe Vestager.

In 2006, Google started to include “exclusivity clauses” in contracts which stopped publishers from placing adverts from Google rivals such as Microsoft and Yahoo on search pages, the Commission said.

From 2009, Google started replacing the exclusivity clauses with “Premium Placement” clauses, which meant publishers had to keep the most profitable space on their search results pages for Google’s adverts and they had to request a minimum number of Google adverts.

Publishers also needed to get written permission from Google before making any changes to how rival ads were displayed, the Commission said.

Between 2006 to 2016, Google had more than 70 billion of the search intermediation market in the EU. It generally had more than 90 billion of the search market and more than 75 billion of the online search advertising market, the Commission concluded.