Google Faces Another Antitrust Test... "EU Considers Order to Separate Advertising Technology Business"

"Possible Cattle Lawsuit as Early as the 14th"... Investigation Starting in 2021

Alphabet, Google's parent company, is once again facing an antitrust lawsuit from the European Union (EU). As a legal dispute targeting its core advertising business is anticipated, reports have emerged that the EU may even demand Alphabet to separate its advertising technology business.

On the 12th (local time), Bloomberg News cited multiple sources reporting that the EU is expected to file an antitrust lawsuit against Alphabet as early as the 14th. The sources indicated that the lawsuit is likely to target Alphabet's advertising technology business model.

[Image source=Reuters Yonhap News]

Advertising accounts for about 80% of Google's annual revenue. Last year, Google's advertising revenue reached $225 billion (approximately 289 trillion KRW). Notably, Google operates a separate advertising technology business within its advertising operations, which accounted for 14% of the total advertising revenue of $54.5 billion in the first quarter of this year.

The advertising technology business includes collecting data to enable advertisers to conduct targeted advertising, allowing advertisers to directly select ad placement locations, and offering options to choose the format of the ads displayed. It also provides technology to prevent ads from appearing next to content that advertisers wish to avoid.

The EU began investigating Google's advertising technology practices in 2021. Concerns were raised that Google's services unfairly benefit its advertising technology competitors. Google countered by stating that advertisers use its tools because they are competitive and efficient.

One source described, "This lawsuit is the most important during the five-year term of the EU's antitrust regulatory authority, the European Commission." Since 2017, the EU has imposed fines on Google three times, totaling over $8 billion.

The Wall Street Journal (WSJ), citing sources, reported that the EU is considering ordering Google to sell part of its advertising technology business. However, large-scale antitrust investigations typically take more than a year after officially raising issues and sometimes conclude without finding violations, so the European Commission may not decide on separating the advertising technology division before the investigation ends.

The WSJ noted, "It is unusual for the European Commission to order the separation of a major company in antitrust cases," adding, "Usually, the matter is resolved through fines or directives to change business practices."

This content was produced with the assistance of AI translation services.