Google Adtech – Break Up or Break Out?

The European Commission recently proposed a break up of Google’s display advertising business. We argue that the market definition used by the Commission risks being too narrow and propose expanding it to include Google’s broader ecosystem. We then ask a simple question; why can consumers not choose which advertising network they would like to use with Google’s zero-priced online platforms? Our answer is that by integrating its advertising network into its popular online platforms, Google has foreclosed competition in the online advertising market by denying rival supply-side ad networks access to its customer base. We propose a remedy called marketised monetisation, which is complementary to the break up proposed by the Commission. Marketised monetisation would introduce an interoperability layer between Google’s popular online services and third-party ad networks to make the online advertising market more contestable. The interoperability layer would allow consumers to choose which firm should monetise their usage of Google’s zero-priced products and services. We argue that such a remedy is within the scope of the Commission’s investigation, is technically feasible, and consider how it could be implemented either through competition law or under the Digital Markets Act.