The competition watchdog is set to publish its initial findings into the dominance of tech giants in the digital ad market this week, paving the way for a possible in-depth investigation.
In July the Competition and Markets Authority (CMA) launched a market study into Google and Facebook, amid concerns the so-called duopoly could be stifling competition online.
The CMA’s initial findings, due to be published in the coming days, will spark a consultation period that could result in an in-depth investigation into the tech giants.
While the watchdog’s study will cover a wide range of topics, it is set to raise concerns over the role of Google’s so-called black box advertising technology, the Sunday Telegraph reported.
The CMA is expected to lay out a series of recommendations to the government on how to counteract potential harm from a lack of competition in the market, with the use of personal data a key factor.
The study came after former chancellor Philip Hammond called for greater regulation of the digital advertising sector.
A string of UK media firms, including the Daily Mail’s parent company and Channel 4, have launched attacks on Google and Facebook over their stranglehold on the market and their “unscrupulous behaviour”.
In its response to the CMA’s study, DMG Media accused Google of using its control over the online ad market to carry out “exclusionary behaviour”, adding that the search giant charged “exploitative” fees for its services.
The watchdog’s findings will also come amid a wider crackdown on tech giants in the US and across Europe.
In addition to digital advertising, the Silicon Valley firms are facing pressure over their low tax returns and failure to police harmful content posted to their platforms.
A CMA spokesperson said: “The CMA is due to publish a wide ranging report as part of its ongoing market study into online platforms and digital advertising. At this point, we are also legally required to consult on whether to make a market investigation.
“As we said at the launch of our study, it is likely that one of the final outcomes from the market study is a series of recommendations to government based on our findings.”