Google Rejects EU’s Breakup Demand, Proposes Alternative Solutions

Google has chosen to reject the European Union’s (EU) suggestion to break up parts of its advertising business. Instead, the tech giant has proposed alternative measures aimed at addressing concerns related to conflicts of interest. This latest move comes amid ongoing scrutiny from regulators in both the US and the EU regarding Google’s advertising practices.

In September, Google faced significant penalties when it was fined €2.95 billion (approximately $3.4 billion) for prioritizing its own online display technology services. The EU claimed that this behavior harmed competitors, advertisers, and publishers who rely on Google’s services. Following this ruling, the European Commission, which oversees competition within the EU, set a deadline for Google to present measures to eliminate these conflicts of interest by November.

Faced with the potential consequences of non-compliance, including a breakup order, Google has opted against selling off parts of its advertising business. Instead, the company submitted a proposal to the EU outlining changes intended to enhance transparency and accessibility for both publishers and advertisers.

Proposed Changes to Advertising Practices

In a statement, Google emphasized that its proposal aims to fully address the European Commission’s concerns without resorting to a breakup that could negatively impact the thousands of European publishers and advertisers who utilize Google tools to expand their businesses. The company’s plan includes significant product changes designed to correct the specific practices identified by the Commission.

One notable change includes allowing publishers to set different minimum prices for various bidders when using Google Ad Manager. This adjustment is expected to create a more competitive environment and provide advertisers with a wider range of options. Additionally, Google has committed to improving the interoperability of its advertising tools, further enhancing the choices available to users.

The Next Steps for the European Commission

The ball is now in the court of the EU’s competition watchdog, the European Commission. Officials will review Google’s proposal and determine whether it meets the necessary requirements to resolve the ongoing issues. If the Commission finds that Google has not sufficiently addressed its concerns, the company may face stricter penalties, including the possibility of enforced divestitures.

As the situation develops, the implications of Google’s decision will be closely monitored by stakeholders across the advertising industry. The outcome could reshape the landscape of digital advertising in Europe, impacting how companies interact with consumers and each other.