Google’s persistent dominance in digital advertising intermediation markets poses new challenges for competition law. This dissertation aims at determining the shortcomings of the current EU competition law and assessing potential legislative solutions to restore competition in those markets.
Last Update: 03.03.22
Digital advertising plays a central role in the digital economy as a financing model for online services that are provided ‘for free’ to end users. Technological progress has led to the dominance of ‘programmatic advertising’ with real-time auctions for online advertising space that take place in a few hundred milliseconds. This process is enabled by a complex chain of technical intermediaries that bring together advertisers and publishers of online content. The dominance of Google in those intermediation markets has led to numerous investigations of competition authorities worldwide assessing the competitive problems in those markets.
The decisions of European competition authorities adopted so far against Google based on Art. 102 TFEU were not able to reach the goals of European competition law. Despite the imposed high fines and the orders to stop the identified abusive practices, Google is subject to new investigations by both the European Commission and the Italian competition authority. Against this backdrop the assumption is justified that the current European competition law framework does not prevent the distortion of competition in those markets. Art. 102 TFEU does not address some core issues in those markets, including Google’s conflicts of interests and the way Google is designing auctions to its own benefit.
The goal of this dissertation is therefore to explore potential legislative solutions for digital advertising intermediation markets. The first step is to discuss and determine the objectives that a competition law solution should pursue in those highly complex and fast evolving digital markets. The dissertation debates whether the goals of fairness and contestability of the Digital Markets Act are reasonable and achievable in practice. After defining the objective and benchmark of a competition law solution, the dissertation then turns to several legislative proposals. Using economic arguments, the impact of the Digital Markets Act and the tailored Code of Conduct proposed by the British CMA on those intermediation markets is going to be explored. What effect will the obligations to ensure price transparency in Art. 5 (g) and Art. 6 (g) of the DMA proposal have on competition in those markets? The goal of this part of the dissertation is to determine whether the examined proposals resolve the shortcomings of the current law and reach the determined benchmark.
Following this economic analysis, the effectiveness of the reform proposals is then compared in the next step. The goal here is to determine which proposed rule is suitable to resolve which existing practical problem. Do the rules of the DMA proposal or the tailored Code of Conduct address Google’s conflicts of interest better? By building on these insights, the dissertation wants to present a competition law framework that can resolve the shortcomings of the existing rules and achieve the determined objectives.
Lukas Kestler
II.3 Vernetzte Datenwirtschaft
