Google: Ad Blocking Chrome Extension Raises Antitrust Issues

Posted by Social Science Research Network

The Capitol Forum

On August 10, The New York Post reported Google notified 700 publishers that the built-in Chrome ad blocker coming out next year will block their ads. The article previews the inherent conflict of Google serving as a gatekeeper for digital ads while also competing against publishers for ad dollars. Google’s plan to include an ad blocker extension in Chrome is likely to exacerbate calls for antitrust enforcers to investigate Google’s dominance throughout the vertical stack composed of the Android operating system, Chrome browser, Google search engine and search ads business—each of which occupy the number one market position.

A close look at ad blocking reveals a surprising lack of public information about the terms of Google’s “whitelisting” agreements with ad blocking companies, agreements in which Google pays to un-block its ads. Two companies—AdBlock and AdBlock Plus—control over 90% of the desktop ad blocking market in the U.S. and Europe and have the apparent power to interfere with billions of dollars in Google ad revenue. AdBlock was purchased in 2015 by an undisclosed buyer, whose identity remains a closely guarded secret.

For their part, publishers have refused to pay ad blockers for whitelisting, and the head of the Interactive Advertising Bureau (IAB), Randall Rothenberg, has referred to such payments as “extortion.” Google’s chrome extension appears to be a move to take control of ad blocking and sheds light on the high stakes for Google of reducing the threat ad blockers pose to its business model.

In researching this article, we spoke to experts on the digital advertising ecosystem and ad blocking, who spoke to us on the condition of anonymity. We also asked Google for comment, and the company directed us to its public comments Building a Better Web For Everyone and Helping Publishers Bust Annoying Ads.

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