PARIS (BLOOMBERG) – Google was fined US$167 million (S$226 million) in a French antitrust case involving online advertising as regulators throughout Europe criticise the tech giant’s business practices.
The French authority found Google abused its dominant position in search when it set “opaque and difficult to understand operating rules” for its Google Ads advertising platform that it applied unfairly and randomly. It’s the first time France’s Autorite de la Concurrence has fined Google, its president Isabelle de Silva told reporters at a Paris press conference Friday (Dec 20).
While the fine is a fraction of Google’s revenue, the company has had several run-ins with antitrust watchdogs in Europe. Earlier this week, UK officials said splitting Google’s ad-server operations from the rest of its business could be an option to counter its dominance. European Union antitrust chief Margrethe Vestager has fined the US technology giant 8.2 billion euros (S$12.3 billion) in three probes over the last two years.
“Google has to do more and better than just any company,” de Silva said. “The rules were not only very difficult to understand” but they also “changed all the time, from one month to the other” without clear communication from Google making it very difficult for advertisers to understand what they could and could not do.
De Silva said the French case was prompted by Gibmedia, which operated weather information and reverse directory websites, which complained after its online ad account was suspended in 2015. Officials have been scrutinising the way US technology firms collect and exploit data to compete in the online advertising sector.
Google, a unit of Alphabet Inc said it will appeal, arguing that its advertising policies were designed to protect people from “exploitative and abusive ads.”
“Gibmedia was running ads for websites that deceived people into paying for services on unclear billing terms,” the Mountain View, California-based company said in a statement. “We do not want these kinds of ads on our systems, so we suspended Gibmedia and gave up advertising revenue to protect consumers from harm.”
Google was also ordered to clarify the rules for Google Ads and its procedure for suspending accounts. It will have to put in place measures to prevent, detect and deal with violations of Google Ads rules. The French authority’s decision must be displayed on the google.com and google.fr home pages for a week.
De Silva said the authority had been in contact with Google over online advertising issues since 2010. Despite some pledges from the company “there’s been very little progress on the points that were raised” nine years ago. “Google was particularly aware of what was expected of it.” Regulators have told the company how it should apply online ad rules including notifying companies to avoid “brutal and unjustified” closures of advertising accounts.
The fine is France’s third biggest monopoly abuse penalty since 2009. French regulators are separately investigating Facebook Inc. following a complaint from Criteo, De Silva said. It will also set up a new digital unit to handle internet issues.
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