PRESS RELEASE

PUBLISHING: ANTITRUST AUTHORITY WIDENS INVESTIGATION INTO GOOGLE. WEBSITE CONTRACT CONDITIONS FOR ONLINE AD SERVING UNDER INVESTIGATION

Compensation for advertising banners sold through Google's system allegedly determined at Google's exclusive discretion with no explanation of calculation methods. Proceeding extended to include Google Ireland Limited

On March 03rd, 2010, the Autorità Garante della Concorrenza e del Mercato decided to widen the investigation that had been initiated last summer to determine whether the contract conditions imposed on Italian website publishers for online ad serving represent an abuse of dominant position by Google.
The investigation focuses on the AdSense system, which is a subscription service through which website owners engage Google as an intermediary in order to sell advertising space. The standard "General Terms and Conditions of Google's Online AdsenseTM Program" contract, which was procured by Antitrust Authority during the course of inspections, revealed the following: the calculation of AdSense subscriber compensations is often left entirely to Google's discretion; Google does not acknowledge any obligation to reveal the calculation methods it employs; payments are calculated exclusively on the basis of registers maintained by Google alone; and Google may modify the price- and/or payment-determining formulas at any point in time at its own exclusive discretion.
In essence, the standard AdSense contract (stipulated with Google Ireland Limited, the firm to which the Antitrust Authority is extending the investigation) prescribes that publisher compensation is to reflect a percentage of Google's own proceeds as determined by advertising banner visualizations on the publisher properties in question. The contract for subscribing to the AdSense program defines revenue-sharing percentages in a way that makes it impossible for Google's counterparts to verify how their actual compensations are calculated.  
According to the Antitrust Authority, Google's contract conditions fail to provide subscribed website publishers with clear, detailed and verifiable indications of how their compensations are determined. Such information is considered to be fundamental for the assessment of Google's intermediation services, and this lack of transparency and verifiability has a serious impact on the commercial and entrepreneurial activities of publishers subscribed to the AdSense program. It inhibits the development and improvement of their own websites, for instance, as well as the comparison of Google's services with competing offers being fielded by other intermediaries.



Rome - March 13th, 2010