EU, UK probe Meta and Google on advertising agreement

The competition authorities of the European Commission and U.K. opened twin investigations Friday into an advertising agreement between Meta and Google, building on the antitrust scrutiny the California-based tech giants are facing abroad. 

The investigations focus around a 2018 agreement, which Google code-named “Jedi Blue,” between Google and Facebook, now under the parent company name Meta, for the participation of Meta’s Audience Network in Google’s Open Bidding program. 

The investigations will look into whether the agreement was part of an effort to exclude ad tech services competing with Google’s Open Bidding program and restricted competition in the online advertising market. 

“Many publishers rely on online display advertising to fund online content for consumers. Via the so-called ‘Jedi Blue’ agreement between Google and Meta, a competing technology to Google’s Open Bidding may have been targeted with the aim to weaken it and exclude it from the market for displaying ads on publisher websites and apps,” European Commission Executive Vice President Margrethe Vestager said in a statement. 

Andrea Coscelli, the chief executive of the U.K.’s Competition and Markets Authority, said it is concerned the tech giants “teamed up” to place obstacles in the “way of competitors.” 

“If one company has a stranglehold over a certain area, it can make it hard for start-ups and smaller businesses to break into the market – and may ultimately reduce customer choice,” Coscelli said in a statement. 

A Meta spokesperson defended the agreement and said the company will cooperate with both inquiries. 

“Meta’s non-exclusive bidding agreement with Google and the similar agreements we have with other bidding platforms, have helped to increase competition for ad placements. These business relationships enable Meta to deliver more value to advertisers and publishers, resulting in better outcomes for all,” the spokesperson said in a statement. 

A Google spokesperson also defended the agreement and said it would answer any questions from the competition authorities. 

“The goal of this program is to work with a range of ad networks and exchanges to increase demand for publishers’ ad space, which helps those publishers earn more revenue. Facebook’s participation helps that,” the spokesperson said in a statement. 

The company has previously defended the agreement when it was invoked as part of a lawsuit filed by a coalition of state attorneys general. 

The Jedi Blue deal was targeted in a lawsuit led by Texas Attorney General Ken Paxton (R). The complaint alleged the deal limited Facebook’s efforts to compete with Google for ad dollars. 

A version of the complaint released in January, in which some formerly redacted sections were unsealed, included internal emails showing the deal was personally approved by Facebook’s Mark Zuckerberg and Google’s Sundar Pichai. 

“We sign hundreds of agreements every year that don’t require CEO approval, and this was no different,” Google spokesperson Peter Schottenfels said in January. “And contrary to AG Paxton’s claims, the fact of this agreement was never a secret — it was well-publicized.”

A Meta spokesperson at the time said, “These business relationships enable Meta to deliver more value to advertisers while fairly compensating publishers, resulting in better outcomes for all.”

— Updated at 3:23 p.m.