Google gives UK watchdog final say on removal of third-party cookies

Google has agreed to let the UK’s competition watchdog have the final say on its Privacy Sandbox proposals before it turns off third-party cookies.

The tech giant also promised to increase its dialogue with publishers, and take on board “reasonable views and suggestions”.

At the same time, European publishers have revolted and accused Google of holding them in an “ad tech stranglehold”.

The Competition and Markets Authority on Friday said it had received legally binding commitments from Google to address competition concerns over its Privacy Sandbox plan to introduce an alternative to third-party cookies that is better for user privacy.

The CMA had begun investigating Privacy Sandbox in January last year as it feared Google’s proposals could undermine the ability of online news publishers to generate revenue, threatening their viability and potentially reducing the availability of news sources to the public. The watchdog also said that if Google’s dominance in the online advertising market grew any further it could weaken competition and harm consumers who ultimately pay for the cost of ads.

Google’s commitments, which will apply globally, mean it must inform the CMA before it intends to remove third-party cookies and wait for approval as the watchdog assesses if there are any remaining competition concerns. This will enforce a “standstill period” of at least 60 days before cookies can be turned off.

In addition the changes to the Google Chrome browser must apply equally to Google’s advertising products as to products from other companies, so that the company’s own products are not at an advantage.

The CMA and data watchdog Information Commissioner’s Office will be involved in the development and testing process to keep an eye on the potential impacts on competition and privacy.

Finally, Google must be “more transparent” than it originally intended by engaging with third parties and publishing test results.

Google has just unveiled its latest Privacy Sandbox proposal for an interest-based advertising model called Topics. Experts told Press Gazette it was a “step in the right direction” for publishers, though not a silver bullet solution.

‘Under no illusions that our work is done’

CMA chief executive Andrea Coscelli said: “The commitments we have obtained from Google will promote competition, help to protect the ability of online publishers to raise money through advertising and safeguard users’ privacy.

“While this is an important step, we are under no illusions that our work is done. We now move into a new phase where we will keep a close eye on Google as it continues to develop these proposals. We will engage with all market participants in this process, in order to ensure that Google is taking account of concerns and suggestions raised.”

William Malcolm, Google’s director of privacy legal in the EMEA, and legal director Oliver Bethell wrote in a blog: “We will apply the commitments globally because we believe that they provide a roadmap for how to address both privacy and competition concerns in this evolving sector.”

They insisted Google wanted to support the “ability of publishers to generate revenue from advertising inventory and the ability of advertisers to secure value for money from advertising spend”, while at the same time supporting a good user experience, providing users with transparency and control in relation to their data, and not distorting competition between Google’s own ad products and those of its competitors.

“We recognise that many publishers and advertisers rely on online advertising to fund their websites and reach new customers,” they said. “So building tools which aim to improve people’s privacy, while continuing to support advertising, is key to keeping the web open and accessible to everyone and allowing businesses of all sizes to succeed.”

The pair said Google would increase its engagement with industry stakeholders, including publishers, advertisers and ad tech providers, “by providing a systematic feedback process to take on board reasonable views and suggestions”.

James Rosewell, from campaign group Movement for an Open Web which represents online business who fear Google’s proposals could threaten their freedom to operate, welcomed the CMA’s decision as “the start of a journey toward more public oversight of big tech promises”.

“Next steps include the creation of the Digital Markets Unit, putting a public authority in charge of making decisions about how digital gatekeepers operate,” he said.

‘Ad tech stranglehold’

The commitments were published on the same day the European Publishers Council, whose members represent the likes of News UK, Bauer Media, The Guardian, The New York Times and Conde Nast, announced it was suing Google over alleged anti-competitive practices in its digital advertising business.

The group said Google has an “ad tech stranglehold” over publishers and other business in the ecosystem, with market shares of more than 90% in some parts of the supply chain, and called on the European Commission to hold the company accountable and find a way to restore effective competition.

EPC chairman Christian Van Thillo, executive chairman of Belgian media company DPG Media, said: “It is high time for the European Commission to impose measures on Google that actually change, not just challenge, its behaviour – behaviour that has caused and continues to cause considerable harm, not just to Europe’s press publishers, but to all advertisers and eventually consumers in the form of higher prices (including ad tech fees), less choice, less transparency and less innovation.

“Competition authorities across the world have found that Google has restricted competition in ad tech, yet Google has been able to get away with minor commitments which do nothing to bring about any meaningful changes to its conduct. This cannot go on. The stakes are too high, particularly for the future viability of funding a free and pluralistic press.

“We call on the Commission to take concrete steps right now that will actually break the stranglehold that Google has over us all.”

Movement for an Open Web backed the EPC, saying the European Commission “must take swift and comprehensive action; addressing not only Google’s Privacy Sandbox Browser changes but also other issues throughout the ad tech ecosystem, on which publishers and society depend”.

A Google spokesperson told Reuters that publishers benefit from its adtech services: “When publishers choose to use our advertising services, they keep the majority of revenue and every year we pay out billions of dollars directly to the publishing partners in our ad network.”