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I think the press release [1] did a good job of detailing the specific activity that was over the line: > Starting in 2006, Google included exclusivity clauses

I think the press release [1] did a good job of detailing the specific activity that was over the line: > Starting in 2006, Google included exclusivity clauses in its contracts. This meant that publishers were prohibited from placing any search adverts from competitors on their search results pages. The decision concerns publishers whose agreements with Google required such exclusivity for all their websites. Even if the search result and some ads were provided by Google, requiring exclusivity for search adverts was too much. [1] http://europa.eu/rapid/press-release_IP-19-1770_en.htm http://europa.eu/rapid/press-release_IP-19-1770_en.htm

AnthonyMouse 8y ago
> Even if the search result and some ads were provided by Google, requiring exclusivity for search adverts was too much. Which completely ignores why ad networks have those restrictions. At one point it was common for crummy web pages to sign up for every ad network. All of them. Because every one you signed up for was more money. Then the whole side of the page would be ads from different networks. The obvious problem is that the advertiser is paying the website for eyeballs, but nobody is ever going to look at all of those ads. It's hard enough to get anyone to look at your ad box when it's the only one on the page. So you're paying for eyeballs and then not getting them. It was like buying a TV ad spot and discovering that the TV network had put it in the middle of an uninterrupted two hour block of just other ads. No surprise that the ad networks then required sites to stop doing that.
- heavenlyblue 8y ago
  I believe Google makes enough cash to hire people who could take care of those spammy websites. Instead, they consciously choose themselves to be a monopoly.
  - AnthonyMouse 8y ago
    What do you mean "take care of them"? If they're not allowed to restrict you from displaying their ads next to ads from other networks, that's the exact thing the spammy websites were doing.
    - Barrin92 8y ago
      They can simply decide to pull their ads and not do business with websites that spam ads, if they think that's detrimental to them or doesn't provide them any value. Exclusivity contracts give way too much power to Google at the expense of everyone else, if we could simply leave it to Google to decide which websites they want to place advertisements on. It's like having a retail electronics store placing bad products from company B next to good products from company A. We don't really let A bully the store into exclusivity either, if A doesn't want to be associated with the store they can simply end their contract.
      - AnthonyMouse 8y ago
        How is refusing to do business with anyone who doesn't give you de facto exclusivity any different than requiring de jure exclusivity?
        heavenlyblue 8y ago
        If they really didn't want to be a monopoly - they'd figure out a way to classify spammers as such and provide a worse selection of ads for them. Rather, they are specifically locking everyone on their platform. I do not completely understand your "de facto" vs "de jure" distinction. Unless of course you don't see any other ways of dealing with your clients but a binary yes/no.
- ABCLAW 8y ago
  If an ad network wants to put restrictions on the volume of ad space in comparison with content on the page, they can do so, but requiring exclusivity isn't the same thing as that.
  - AnthonyMouse 8y ago
    Measuring the "content on the page" is hopelessly ambiguous and easy to scam. Even trying to price just based on how many other ad networks there are is problematic. For each additional ad network the value of each ad goes down. Even adding a second one may cut the value more than in half compared to exclusivity, because if the user sees the other network's ads first and they don't appear relevant they may not even look at yours, and a user who sees a larger number of ads may not look closely at any of them. If the price offered for any non-exclusive placement is more of a reduction over the price offered for exclusivity than the amount gained from the other ad network(s), how is that any different in practice than requiring exclusivity?
    - ABCLAW 8y ago
      >Measuring the "content on the page" is hopelessly ambiguous and easy to scam. Is it? It seems pretty simple to audit your 10,000 largest ad-spend domains and check to see if they're actually just ad fraud. You'd need maybe 300 person-hours to do so, at an overhead-in cost of, let's high-ball it, 100$/hr, which puts you at a cost of $30,000. If you mean the process is impossible to automate, then don't try to automate it. You can catch 99% of fraud with very low-effort manual review in most industries. That Google doesn't do it doesn't speak to the inability to get it done. It speaks to their unwillingness. In short: exclusivity is there to choke out other ad networks. >If the price offered for any non-exclusive placement is more of a reduction over the price offered for exclusivity than the amount gained from the other ad network(s), how is that any different in practice than requiring exclusivity? The comparison you're making in the last paragraph is a common mistake in examining competition scenarios. The comparison isn't between pricing between the market leader and the incumbents following the anti-competitive behavior. It's the comparison between the prices we would have had no anti-competitive behavior existed in the first place.
Veelox 8y ago
From the press release >Google has abused this market dominance by preventing rivals from competing in the online search advertising intermediation market. >Based on a broad range of evidence, the Commission found that Google's conduct harmed competition and consumers, and stifled innovation. Google's rivals were unable to grow and offer alternative online search advertising intermediation services to those of Google. As a result, owners of websites had limited options for monetizing space on these websites and were forced to rely almost solely on Google. This just doesn't make sense to me. So Google offers the website search functionality. It then says "If you want to run ads, you have to use our ads" a few years later Google says "If you want to run ads, you have to give us the best N spots, and all other ads have to be approved by us." Because of this the EU concludes "rivals were unable to grow and offer alternative online search advertising intermediation services." I am really trying to read the logic some other way but the logic appears to be as follows 1) Google let people set up search pages on individual websites. 2) Google set the terms for ads on those search pages so that Google had exclusive/best ad spots on those search pages. 3) 2 limited competitors ability to develop an alternative to 1. 4) Because Google had a dominate market position, 3 is illegal and should be fined. This honestly feels pants-on-the-head crazy to me because I do not see how this logic doesn't apply to Google.com. Should Google be forced to let Bing run adds on "google.com/search?q=shoes"? No! Yet if it is "ShoeReviews.com/search?q=shoes" suddenly Google is required to let Bing run adds on it. Edit: Formatting
- squaresmile 8y ago
  I think a thing to keep in mind is this is about antitrust and "Google is dominant in the market for online search advertising intermediation in the EEA". Exclusivity deal was nothing strange but abusing "this market dominance by preventing rivals from competing in the online search advertising intermediation market." wasn't ok. The exclusivity deal might have been fine were it not for Google's dominant position.
- Msurrow 8y ago
  Based on the bloomberg videoclip showing Vestager explaining the decision: You have your second point (bullet 2) wrong. Google’s exclusivity clause said that if you use google search-box on your site you cannot use any other ad broker on any of you other sites.

AnthonyMouse 8y ago

> Even if the search result and some ads were provided by Google, requiring exclusivity for search adverts was too much. Which completely ignores why ad networks have those restrictions. At one point it was common for crummy web pages to sign up for every ad network. All of them. Because every one you signed up for was more money. Then the whole side of the page would be ads from different networks. The obvious problem is that the advertiser is paying the website for eyeballs, but nobody is ever going to look at all of those ads. It's hard enough to get anyone to look at your ad box when it's the only one on the page. So you're paying for eyeballs and then not getting them. It was like buying a TV ad spot and discovering that the TV network had put it in the middle of an uninterrupted two hour block of just other ads. No surprise that the ad networks then required sites to stop doing that.

heavenlyblue 8y ago
I believe Google makes enough cash to hire people who could take care of those spammy websites. Instead, they consciously choose themselves to be a monopoly.
- AnthonyMouse 8y ago
  What do you mean "take care of them"? If they're not allowed to restrict you from displaying their ads next to ads from other networks, that's the exact thing the spammy websites were doing.
  - Barrin92 8y ago
    They can simply decide to pull their ads and not do business with websites that spam ads, if they think that's detrimental to them or doesn't provide them any value. Exclusivity contracts give way too much power to Google at the expense of everyone else, if we could simply leave it to Google to decide which websites they want to place advertisements on. It's like having a retail electronics store placing bad products from company B next to good products from company A. We don't really let A bully the store into exclusivity either, if A doesn't want to be associated with the store they can simply end their contract.
    - AnthonyMouse 8y ago
      How is refusing to do business with anyone who doesn't give you de facto exclusivity any different than requiring de jure exclusivity?
      - heavenlyblue 8y ago
        If they really didn't want to be a monopoly - they'd figure out a way to classify spammers as such and provide a worse selection of ads for them. Rather, they are specifically locking everyone on their platform. I do not completely understand your "de facto" vs "de jure" distinction. Unless of course you don't see any other ways of dealing with your clients but a binary yes/no.
ABCLAW 8y ago
If an ad network wants to put restrictions on the volume of ad space in comparison with content on the page, they can do so, but requiring exclusivity isn't the same thing as that.
- AnthonyMouse 8y ago
  Measuring the "content on the page" is hopelessly ambiguous and easy to scam. Even trying to price just based on how many other ad networks there are is problematic. For each additional ad network the value of each ad goes down. Even adding a second one may cut the value more than in half compared to exclusivity, because if the user sees the other network's ads first and they don't appear relevant they may not even look at yours, and a user who sees a larger number of ads may not look closely at any of them. If the price offered for any non-exclusive placement is more of a reduction over the price offered for exclusivity than the amount gained from the other ad network(s), how is that any different in practice than requiring exclusivity?
  - ABCLAW 8y ago
    >Measuring the "content on the page" is hopelessly ambiguous and easy to scam. Is it? It seems pretty simple to audit your 10,000 largest ad-spend domains and check to see if they're actually just ad fraud. You'd need maybe 300 person-hours to do so, at an overhead-in cost of, let's high-ball it, 100$/hr, which puts you at a cost of $30,000. If you mean the process is impossible to automate, then don't try to automate it. You can catch 99% of fraud with very low-effort manual review in most industries. That Google doesn't do it doesn't speak to the inability to get it done. It speaks to their unwillingness. In short: exclusivity is there to choke out other ad networks. >If the price offered for any non-exclusive placement is more of a reduction over the price offered for exclusivity than the amount gained from the other ad network(s), how is that any different in practice than requiring exclusivity? The comparison you're making in the last paragraph is a common mistake in examining competition scenarios. The comparison isn't between pricing between the market leader and the incumbents following the anti-competitive behavior. It's the comparison between the prices we would have had no anti-competitive behavior existed in the first place.

Veelox 8y ago

From the press release >Google has abused this market dominance by preventing rivals from competing in the online search advertising intermediation market. >Based on a broad range of evidence, the Commission found that Google's conduct harmed competition and consumers, and stifled innovation. Google's rivals were unable to grow and offer alternative online search advertising intermediation services to those of Google. As a result, owners of websites had limited options for monetizing space on these websites and were forced to rely almost solely on Google. This just doesn't make sense to me. So Google offers the website search functionality. It then says "If you want to run ads, you have to use our ads" a few years later Google says "If you want to run ads, you have to give us the best N spots, and all other ads have to be approved by us." Because of this the EU concludes "rivals were unable to grow and offer alternative online search advertising intermediation services." I am really trying to read the logic some other way but the logic appears to be as follows 1) Google let people set up search pages on individual websites. 2) Google set the terms for ads on those search pages so that Google had exclusive/best ad spots on those search pages. 3) 2 limited competitors ability to develop an alternative to 1. 4) Because Google had a dominate market position, 3 is illegal and should be fined. This honestly feels pants-on-the-head crazy to me because I do not see how this logic doesn't apply to Google.com. Should Google be forced to let Bing run adds on "google.com/search?q=shoes"? No! Yet if it is "ShoeReviews.com/search?q=shoes" suddenly Google is required to let Bing run adds on it. Edit: Formatting

squaresmile 8y ago
I think a thing to keep in mind is this is about antitrust and "Google is dominant in the market for online search advertising intermediation in the EEA". Exclusivity deal was nothing strange but abusing "this market dominance by preventing rivals from competing in the online search advertising intermediation market." wasn't ok. The exclusivity deal might have been fine were it not for Google's dominant position.
Msurrow 8y ago
Based on the bloomberg videoclip showing Vestager explaining the decision: You have your second point (bullet 2) wrong. Google’s exclusivity clause said that if you use google search-box on your site you cannot use any other ad broker on any of you other sites.