France may probe Google and Facebook over online ad dominance

By Mathieu Rosemain and Gwenaëlle Barzic

PARIS (Reuters) - France's competition authority may open investigations into Facebook and Google "in the next few months" after an in-depth examination concluded the pair dominate the French online advertising market.

The regulator said it was considering a full inquiry on Tuesday amid growing scrutiny from European authorities of the biggest internet companies, whose size and sway over data collection have rapidly made them advertising giants.

"What is clear is the overwhelmingly dominant position of Google and Facebook," president of the French competition body, Isabelle de Silva, said.

The authority's report highlighted that the two companies acted as both publishers and technical intermediaries for advertisers, giving them a competitive advantage.

"Facebook is only one option among many others for advertisers to reach audiences," Delphine Reyre, Facebook's director of policy for Europe, said in a statement.

Facebook and Google, which did not immediately comment, accounted for 76 percent of internet ad spending outside China in 2016, a report by Publicis agency Zenith found.

The situation is the same in France, where the internet has become the number one vehicle for advertisers, ahead of television, with more than a third of total ad spending in 2017, up 3.4 percentage points from 2016.

ANTI-COMPETITIVE

"We've seen many players complain about certain behaviours," de Silva said, referring to meetings the authority had with French advertisers, service providers and publishers.

These include strategies involving bundling or tied sales, low prices, discriminatory treatment and restrictions on the possibilities of collecting and accessing certain data.

The French competition authority can impose fines of up to 10 percent of a company's total yearly revenues.

Any investigation takes about two years to reach a conclusion and any sanction.

"Broadcasters, traditional media, and a range of other online platforms are increasingly using data and sophisticated targeting techniques to deliver relevant ads to users, and there is no barrier preventing other new entrants doing the same," Facebook's Reyre said.

(Reporting by Mathieu Rosemain and Gwenaelle Barzic; Editing by Sudip Kar-Gupta and Alexander Smith)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)