"We need to talk": European Commission fires break-up warning shot in Google AdTech investigation

The European Commission’s announcement that it will likely be necessary for Google to break up its ad tech stack to prevent it from abusively leveraging its dominant position in favour of its ad exchange (AdX) has rightly triggered headlines and debate. Plus an opportunity to draw some (sepia-laced) comparisons with the breakup of Standard Oil in the 1910s.

Some immediate thoughts:

• The arch-pragmatist
  Having made headlines last month for its pragmatic approach to access remedies in Microsoft / Activision, the Commission’s breakup threat in Google Ad Tech is a timely reminder that it is not afraid to push boundaries. 
  
  With no previous decision successfully forcing divestiture in antitrust proceedings (the failed attempt in Continental Can in 1973 being the closest the Commission has managed to date), the decision would set new precedent and make Article 102 TFEU a significantly more powerful practical tool than many had assumed. 
  
  For those of a more open market bent wanting to see some positives, the Commission’s horses for courses approach to remedies at least indicates a more pragmatic mindset to its cases (even if you disagree with the outcome here).
  
  
• Fool me once… 
  When the Commission cleared Google’s acquisition of DoubleClick in 2008, it found that “even in the very unlikely event” that Google bundled its ad intermediation services with Doubleclick’s ad serving, such a strategy would be “very unlikely to have a significant detrimental effect on competition” and that it was “questionable whether customers would be harmed in the long run, or in other words, whether the overall impact on competition would be negative, taking efficiencies into account”. 
  
  Today’s announcement suggests a willingness to tackle (perceived) past mistakes. More seriously, if successful, it would also mean that the TowerCast judgment – permitting greater ex post intervention in mergers – carries much greater weight in a world where structural remedies are a more realistic instrument in the toolbox.
  
  
• Transatlantic harmony? 
  The Commission’s move today mirrors the position of enforcers across the Atlantic, where earlier this year the DoJ sued Google to break up its ad business. 
  
  After playing a game of regulatory whack-a-mole in the digital sphere for more than a decade, the Commission seems to have decided to borrow some of the tools from its American colleague’s toolbox: where structural remedies in antitrust, even if rare, have had a greater presence in the debate. 
  
  It points to a future where the authorities may be significantly more aligned in relation to the use of remedial powers (if not necessarily on their worldview).

Google will now have the opportunity to respond to the Statement of Objections. Stay tuned for what is shaping up to be one of the most fiercely contested EU antitrust investigations in recent history...