Canada’s Competition Bureau has filed a lawsuit against Google, accusing the tech giant of anti-competitive practices in the online advertising technology services in the country. The antitrust watchdog has accordingly submitted an application to the Competition Tribunal. The application accuses Google of exploiting its dominance within the digital advertising technology ecosystem. This market, commonly referred to as the “ad tech stack”, has been used by Google – the Competition Bureau alleges – to reinforce its market power and suppress competition.
In 2020, the Competition Bureau began investigating whether the search engine giant was engaging in practices that harmed competition in the online advertising sector. The scope of the investigation was expanded earlier this year to include Google’s advertising technology services.
Google controls an estimated 90% of the share of publisher ad servers, 70% of advertiser networks, and significant shares in other critical components of the ad tech stack. The bureau’s case centres on claims that Google has engaged in practices that lock market participants into its ecosystem, stifle innovation and inflate advertising costs. Specific allegations include unlawfully tying its advertising products together, giving preferential treatment to its tools in ad auctions and imposing restrictions that limit publishers’ ability to transact with competing platforms.
Google’s alleged tactics to suppress competition
The Competition Bureau’s investigation further found that Google’s conduct allowed the company to position itself at the centre of the ad tech ecosystem, using its dominant control over the entire ad tech stack to strengthen its position across various products. By leveraging its power in one area, Google allegedly reduced the competitiveness of rival ad tech tools and discouraged new market entrants. The bureau asserts that these practices have effectively insulated Google from competition while harming Canadian publishers, advertisers, and consumers.
“Google’s conduct has prevented rivals from being able to compete on the merits of what they have to offer, to the detriment of Canadian advertisers, publishers and consumers,” said Canada’s Commissioner of Competition, Matthew Boswell. “We are taking our case to the Tribunal to stop this conduct and its harmful effects in Canada.”
As part of its lawsuit, the Canadian regulator is seeking an order to compel Google to divest at least two of its advertising technology tools: ad server DFP and ad exchange AdX. It also aims to secure penalties to enforce compliance with Canada’s Competition Act and prevent future anti-competitive conduct.
Google has denied the allegations, describing the online advertising market as intensely competitive. “Our advertising technology tools help websites and apps fund their content and enable businesses of all sizes to effectively reach new customers,” defended Google’s vice president for global ads Dan Taylor.
This lawsuit in Canada comes amid growing scrutiny worldwide into Google’s market activities. In the US, the Department of Justice (DoJ) recently concluded arguments in a case accusing the company of monopolising key segments of the online advertising sector. Meanwhile, in the European Union (EU), regulators earlier this year rejected Google’s offer to divest its ad exchange to address antitrust concerns.
The Competition Tribunal will oversee the Canadian case, with Google expected to respond within 45 days.
