Several small tech companies have accused Google of stifling competition due to its monopoly of the online advertising market – amid calls to increase competition by lawmakers.
The House of Lords communications and digital committee heard the tech giant is “killing off industries”, and that its dominance leads to higher prices.
In the hearing which discussed the potential impact of the Digital Markets, Consumer and Competition Bill, Richard Stables, chief executive at Kelkoo Group, an e-commerce marketing platform. claimed that “consumers are paying higher prices because retailers are paying higher prices for their advertising”.
A report published by Britain’s competition regulator in 2020 found that Google’s market dominance has a “significant impact” on prices. When comparing like-for-like searches, Google’s prices were 30-40 percent higher than Bing’s.
Kelkoo first filed a complaint about Google to the European Commission in 2009, which is still ongoing today.
Likewise, News Association boss Owen Meredith told lawmakers he wants to see a recognition of the value that news brings to Google, such as the data it collects from news sites and sells on to advertisers.
“I would say for all news publishers, digital markets do not function properly. There has essentially been a market failure”, Meredith told the committee this week.
He added that the new legislation is important because “a small handful of highly powerful companies control the discovery gateways for the majority of the internet, particular for news across search, social and mobile ecosystems”.
Also speaking at the hearing was Tom Fish, head of public policy at Gener8, a software company empowering users to control their own data and earn from it.
“We miss out on a potential revenue stream for our browser owing predominantly to Google’s dominance in search”, said Fish.
All the tech companies at the committee were in favour of introducing the DMCC Bill, which aims to increase competition and innovation in digital markets and is set to enter into force in 2024.
Last week the European Union’s competition chief Margrethe Vestager announced a “statement of objections” to Google’s advertising business, which the regulator says the tech giant must sell parts of in order to comply with their laws.
Vestager believes Google has overcharged advertisers and has previously fined the tech company several times, amounting to a total of over €8bn (£6.8bn).
Yesterday American mass media company Gannett sued Google for deceptive online ad tactics which give them “exorbitant monopoly profits”.
Google were approached for comment.
Dan Taylor, vice president of Google Ads, said previously bout being sued by Gannett, that “these claims are simply wrong.”
He added publishers have many options for advertising technology, and “keep the vast majority of revenue” when they use Google.
In response to the EU wanting to break up Google ads’ business Taylor told the Telegraph the firm “remains committed to creating value for our publisher and advertiser partners in this highly competitive sector.
“The Commission’s investigation focuses on a narrow aspect of our advertising business and is not new. We disagree with the EC’s view and we will respond accordingly.”