Google, Facebook antitrust pressure grows as US lawmaker cheers UK investigation
Google made more than 90 percent of the £6.4 billion spent on digital search advertising in the U.K. in 2018.
Texas Attorney General Ken Paxton on Wednesday applauded the U.K.'s antitrust investigation against Facebook and Google, increasing pressure on both companies that some say demonstrate monopolistic behavior.
The U.K. Competition and Markets Authority (CMA) found that Google and Facebook hold extreme dominance in the advertising market and stifle competition for other smaller advertising entities in Britain, according to a preliminary report published Wednesday.
"The digital advertising industry helps British businesses of all sizes find customers in the U.K. and across the world, and supports the websites that people know and love with revenue and reach," a Google U.K. and Ireland Vice President Ronan Harris told FOX Business
"We’ve built easy-to-use controls that enable people to manage their data in Google’s services -- such as the ability to turn off personalized advertising and to automatically delete their search history. We’ll continue to work constructively with the CMA and the government on these important areas so that everyone can make the most of the web," he added.
Paxton and 51 other attorneys general from across the country signed onto a similar antitrust probe against Google in September in an effort to expose the tech giant's monopolistic practices, specifically in terms of advertising.
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"The CMA — like many other competition authorities around the world, including the Texas-led multistate bipartisan coalition of 51 attorneys general — is examining the dominance and conduct of tech giant Google in online markets, and I applaud those efforts," Paxton said in a Wednesday statement.
"The CMA's interim report reflects a growing concern over Google's business practices, and we intend to closely follow the facts we discover in our own investigation and proceed as necessary if Google has harmed competition, undermined consumer choice, stifled innovation, or violated users’ privacy and trust," Paxton added.
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The research found that Google made more than 90 percent of the £6.4 billion spent on digital search advertising in the U.K. in 2018. The tech giant made up about 90 percent or more of total internet searches in the U.K. every year over the past 10 years.
Facebook made more than 50 percent of the £5 billion spent on digital display advertising in the U.K. in 2018. The social media platform with more than 2.3 billion users made four times more than Google's YouTube in digital display advertising and more than the entirety of the display market, the report notes.
"It is important to be clear that 'big' is not necessarily 'bad' in these markets. Where a platform has gained a large market share by being consistently better than its competitors and where it must respond to continued 11 competitive pressures to maintain that position, it may be considered to operate within a competitive market even with a large market share," the study reads.
"However, if potential competitors face substantial barriers to entry and expansion, such that the market is no longer properly contestable, then a high market share can translate into market power, giving the platform the opportunity to increase prices, reduce quality or leverage market power to undermine competition in potentially competitive markets," it continues.
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Paxton explained his reasoning behind leading an antitrust investigation against Google in a September interview with The Daily Caller News Foundation after he announced the probe.
"Everybody thinks the internet is free, and it's not," Paxton said. "When you have one player so dominant in the search engine, advertising market … it's like a real estate transaction. [Google represents] the buyers, they're on the seller side, they're the auctioneer, and they control the video platform that a lot of people use."
Google responded to the probe in a Sept. 6 statement, saying, "It's, of course, right that governments should have oversight to ensure that all successful companies, including ours, are complying with the law," but the investigation "is not new" for the company.