ACCC calls for more powers to regulate Google and “restore competition” to the adtech sector

ACCC chairman Rod Sims

ACCC chairman Rod Sims. Source: AAP/Dean Lewins

The ACCC is calling for more powers to regulate big-tech goliath Google, specifically when it comes to advertising technology.

The final report on the ACCC’s digital advertising services inquiry, released yesterday, identifies significant concerns around competition in Australian adtech, particularly in relation to Google and its dominance in the market.

This likely harms publishers, advertising businesses and consumers alike, the report says.

The problems are so considerable that enforcing existing anti-competition laws will not go far enough to address them.

So the report suggests the ACCC should be given the green light to develop more specific rules in response to big tech, and Google’s activities in particular.

The report estimates that in 2020, more than 90% of ad impressions traded through the adtech supply chain passed through at least one Google service.

That gives the tech giant a “dominant position” in the supply chain for online ads, underpinned by its access to customer data, its visibility of inventory and the integration across its services.

“Google has used its vertically integrated position to operate its ad tech services in a way that has, over time, led to a less competitive adtech industry,” ACCC chair Rod Sims said in a statement.

Ultimately, this causes harm to businesses, he explained.

“Google’s activities across the supply chain also mean that, in a single transaction, Google can act on behalf of both the advertiser (the buyer) and the publisher (the seller) and operate the ad exchange connecting these two parties.

“As the interests of these parties do not align, this creates conflicts of interest for Google which can harm both advertisers and publishers.”

Sims also noted that the ACCC is concerned the lack of competition in this space has led to higher ad fees. That may have in turn led to reduced quality or quantity of online ad content, leading to consumers paying more for advertised goods.

The ACCC is currently in the process of considering specific allegations against Google, under existing anti-competition laws.

However, Sims stressed that the current laws don’t go far enough to tackle the problem. New regulatory solutions are needed in order to “restore competition to the adtech sector for the benefit of businesses and consumers”, he said.

“We recommend rules be considered to manage conflicts of interest, prevent anti-competitive self-preferencing, and ensure rival adtech providers can compete on their merits.”

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