On October 28, the Italian Competition Authority announced that an investigation of Google’s core business - display advertising - is underway. The Authority claims that Google practices prevent rivals from competing effectively and affect consumers negatively.
For this reason, the Italian Competition Authority opened an investigation against Google for an alleged abuse of dominant position. The undertaking, controlled by Alphabet Inc, might have violated Article 102 of the Treaty on the Functioning of the European Union with regard to the availability and use of data for the design of display advertising campaigns, i.e. the space that publishers and website owners make available for the display of advertising content.
The decision comes in a context in which Google is one of the most prominent players in both search advertising and digital display advertising. Moreover, Google is well established in the ad tech stack, capturing over 50% of the market that in 2019, in Italy was valued more than 3.3 billion euros. Unsurprisingly, Google has already had the pleasure of meeting other competition authorities around the world. Lately, in March 2019, the European Commission decided to fine Google € 1.49 billion for abusing its dominant position in the market of online search advertising by restricting users to see Google’s rivals search ads.
Now, under the lens of the Italian Competition authority there is Google’s display advertising. We are all used to the ads that fill up websites and the feed on social networks. But let’s dig deeper: what is display advertising? The OECD describes it as the text, images, or videos that appear on our screen, be it in advertising boxes or banner ad. What makes this form of advertising so valuable is, basically, us. In terms of user data at least: data concerning the identity of the consumer visiting a website is particularly important for targeting digital display advertising, which cannot rely on user inputs in the same way as search advertising.
Two types of technology have raised the concerns of the Italian competition authority, e.g. the decryption keys of Google ID and the use of pixels. Pixels are small, almost invisible graphics that embed a piece of code that is loaded when a user visits a webpage or opens an email used often by businesses for third party tracking. Actually, what is wrong is not the technology to track user data itself - but the fact that Google is excluding its competitors to access (and benefit from) this data and technologies that enhance the process of targeting ads. Allegedly, Google has engaged in internal-external discrimination by refusing to provide the decryption keys of the Google ID and in excluding the possibility of tracking third-party pixels.
In short, the investigation of the Italian Competition Authority highly emphasizes the role of user data, technology, and the choices of Google regarding these tech. However, our concern as users in the first place, also regards our privacy as consumers. Secondly, the power gained by Google in the digital advertising market through data gathering and the tying of its services and products has created a scenario that favours targeted and invasive advertising with contents - while it is questionable whether or not this adds to the welfare of consumers. Indeed, the problem is not only how much data is being gathered or displayed but also the way these processes are actually taking place.
After all, are we really aware of how much information we disclose? And even if the answer is yes, are we aware of how our data contributes to the value-creating process of tech molochs - Google in the first place? The figures on the profits of Google and the other big-tech giants speak for themselves. But... Do users still enjoy a piece of the cake?
(Alvise, Gianluca, Julia, Lorenzo, Giulia and Daniel - UniTrento Master Students)
