Ottawa, Canada - In a move that could have significant implications for Google's dominance in the online advertising market, Canada's antitrust watchdog, the Competition Bureau, is intensifying its investigation into the search giant's practices. The Bureau announced Thursday that it has broadened the scope of its probe, which began in 2020, to specifically examine whether Google engages in predatory pricing, a strategy that could stifle competition and harm consumers.
The initial investigation focused on whether Google's conduct in the online display advertising market, which encompasses ads displayed on websites and applications, was hindering the success of competitors and leading to higher prices and fewer choices for consumers. Now, the Bureau is casting its net wider, looking into whether Google is leveraging its significant market power to manipulate the landscape through predatory pricing in display advertising technology services.
Predatory pricing refers to the deliberate practice of an established company setting artificially low prices with the intention of driving out competition or gaining an unfair advantage. The Bureau's investigation will delve into whether Google is utilizing such tactics to disadvantage or eliminate its rivals in the online advertising technology space.
The Competition Bureau has secured a court order from the Federal Court of Canada, compelling Google to produce relevant records and information to facilitate the investigation. This underscores the Bureau's determination to uncover the truth and ensure a fair and competitive advertising environment.
Responding to the broadened investigation, a Google spokesperson maintained that businesses use the company's advertising products due to their proven effectiveness. They further emphasized the highly competitive and ever-evolving nature of the advertising technology industry, claiming it has reduced costs and increased choices for consumers. Additionally, the spokesperson asserted Google's willingness to cooperate with the Bureau's investigation.
It's worth noting that this Canadian investigation is not an isolated incident. In the United States, the Justice Department filed a lawsuit against Google in 2023, seeking to break up its dominance in the online advertising market. The lawsuit alleges that Google abuses its power as a major player in the buying, selling, and auctioning of online ads, ultimately harming competition and consumers. A trial date for this case is set for September 2024.
