A bill has been introduced in the Senate that would disrupt Google’s advertising activities if passed into law. Supported on both sides of the aisle, the Competition and Transparency in Digital Advertising Act would prevent companies processing more than $20 billion in annual digital advertising transactions from participating in more than one part of the digital advertising ecosystem. as the Wall Street Journal reports.
Google easily falls under that distinction. It generated $54.7 billion in ad revenue in the past quarter alone. While other companies meet the dollar threshold of the proposed rules, Google has a hand in many aspects of the advertising process. It operates an exchange where ad networks bid on inventory. It also provides tools to help businesses buy and sell ads.
There will also be a parliamentary version of the law shortly. If the bill becomes law, Google would have to exit some of those companies. It would have a year to comply with the rules after the law is passed. Meta can also be affected by legislation.
“Having Google as a seller and buyer at the same time and conducting an exchange gives them an unfair, inappropriate advantage in the marketplace, one that doesn’t necessarily reflect the value they provide,” Sen. Mike Lee (R-Utah) told the Journal. “If a company can wear all of these hats at once, it could engage in behavior that harms everyone.”
Lee is the ranking member of the Subcommittee on Competition Policy, Antitrust and Consumer Rights. Commission President Sen. Amy Klobuchar (D-Minnesota) is a co-sponsor of the bill, as are Sens.Ted Cruz (R-Texas) and Richard Blumenthal (D-Connecticut).
“Advertising tools from Google and many competitors help U.S. websites and apps fund their content, help businesses grow, and protect users from privacy risks and misleading ads,” a Google spokesperson told Engadget. quality and create new privacy risks. And at a time of heightened inflation, it would hinder small businesses looking for easy and effective ways to grow online. The real problem is low-quality data brokers who threaten Americans’ privacy and flood them with spam ads. In short, this is the wrong bill, at the wrong time, aimed at the wrong target.”
Other provisions of the bill include rules for companies that process at least $5 billion in ad transactions per year. They should offer transparent pricing and act in the best interest of their customers. Customers would have the option to sue for violations thereof.
Other antitrust laws targeting tech giants are in the works. Klobuchar’s American Innovation and Choice Online Act, which passed out of commission in January, would prohibit companies from favoring their own products over rivals on their own platforms. For example, Apple would not be able to rank its own apps above competing apps in the App Store search results.
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