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Secret advertising deal between Google and Meta under investigation in Europe

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Secret advertising deal between Google and Meta under investigation in Europe

A secret deal between Facebook’s parent company, Google, and Meta is being investigated by antitrust regulators in the EU and UK for potentially weakening competition in the billion-dollar digital advertising market.

The investigation, which was announced on Friday by the European Commission and the UK Competition and Markets Authority, is the latest effort to examine the business practices of the world’s largest technology companies.

The investigation focused on the 2018 deal was revealed for the first time as part of a lawsuit against Google by 10 state attorneys general in the United States, regulators said. The US investigation concluded that Google reached an agreement, referred to internally as “J.D. Blue”, to limit how much Facebook could negotiate with one of Google’s flagship services for advertising dollars. will compete.

“If confirmed by our investigation, this would restrict and distort competition in an already focused advertising technology market, to the detriment of rival advertising service technologies, publishers and ultimately consumers,” said European Commission Executive Vice President Margrethe Vestager. , which oversees competition and digital policy, said in a statement.

Google and Meta said the agreement between the two companies was not exclusive and that similar arrangements are used by dozens of other companies.

Google said in a statement, “The allegations made regarding this agreement are false.”

Meta said the agreement was similar to the one the company had entered into with other partners for digital advertising. “These business relationships enable Meta to deliver greater value to advertisers and publishers, resulting in better outcomes for everyone,” the company said in a statement.

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Announcing a formal investigation is one step in a process that could take years to finish.

The investigation reveals how regulators around the world are pressuring tech companies that dominate the digital economy. The results of the investigation, along with new laws being drafted in the European Union and the United States, could lead to major changes in the way companies do business with app stores, e-commerce and digital advertising.

Other investigations are underway at the European Commission, the executive arm of the 27-nation bloc, at Amazon, Apple and Google. British regulators are investigating Apple’s App Store policies, Meta’s use of data and the mobile ecosystem controlled by Apple and Google.

The European Commission and British regulators have pledged to cooperate with the investigation, which is one of the first major competition cases in which the two government bodies have pledged to work together since the UK left the EU in 2020.

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