The European Commission, the European Union(EU) antitrust body, has formally opened an investigation into whether the agreement between Google and Meta, the company that owns Instagram, WhatsApp and Facebook, violated competitive practices in the field of digital ads. Facebook reportedly gave up the “Jedi Blue” project after accepting favors from its rival to take priority in buying internet advertising spaces.
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However, in September 2018, Facebook would have remade a digital ad ecosystem that would put it face-to-face in the dispute with Google, called Jedi Blue. An agreement was made for the project to be halted, and the company controlled by Alphabet Inc. promised, in return, to prioritize Mark Zuckerberg’s company in the sale of ad spaces.
The European Commission has raised concerns that the 2018 agreement on Jedi Blue “is part of efforts to exclude competitors from the auction in Google’s Open Bidding program, and therefore restrict and limit competition in digital ad markets.”
Open Bidding is a program that aggregates ad requests managed by Ad Manager. After an order to occupy an advertising space is made to Google, the ad tool conducts a unified auction to determine which ad piece generates the best yield, using information such as audience targeting.
The agreement with Google put Facebook first in the open bidding program queue when sending ad requests.
Google and Meta agreement is the target of lawsuits in the U.S.
Before being investigated by the European Union’s antitrust body, the interruption of the Blue Jedi was already the subject of 15 lawsuits opened in the United States Courts by attorneys general of states in the country. The lawsuits accuse some of Facebook and Google’s top executives, including the CEOs of both companies, Mark Zuckerberg and Sundar Pichai, of signing the deal.
The u.S. attorneys general’s conclusion is that the two, among the world’s largest technology companies, have teamed up to save money and hurt rivals.
The body that oversees agreements, purchases and mergers of companies in the UK, the CMA (Competition Markets Authority), has also opened an investigation into the Blue Jedi. “We are concerned that Google may have partnered with Meta to impose barriers in the way of competitors offering ad spaces,” said Andrea Coscelli, head of the entity.