DoJ Investigates Google Over Its Plans To Block Cookies

Published on

Alphabet Inc (NASDAQ:GOOGL)’s Google plan to block cookies, a common tool websites use to track users, has drawn the scrutiny of antitrust regulators.

Get The Full Ray Dalio Series in PDF

Get the entire 10-part series on Ray Dalio in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues

Q4 2020 hedge fund letters, conferences and more

Citing sources familiar with the matter, Reuters reports that investigators from the U.S. Department of Justice have been talking to executives in the advertising industry. They want to know if the move will have a significant negative impact on Google's smaller rivals.

Google decides to ban cookies

Google announced a year ago that it would start blocking some cookies in Chrome to improve privacy for users. Over the last two months, the company revealed more information, and digital advertising competitors started complaining about losing access to the data-gathering tool.

Four sources told Reuters that the DoJ's investigators are asking about how Chrome's policies affect the news and advertising industries. Chrome holds a 60% share of the global search market, and they want to know if Google is using it to decrease competition by keeping other ad firms from tracking users via cookies.

Investigators also want to find out if Google is leaving loopholes to allow itself to continue gathering data using sources like cookies and other analytics tools. The probe reveals that officials are keeping an eye on Google's practices in the digital ad market, where it and Facebook account for approximately 54% of revenue.

Reuters said the investigation might not result in legal action against Google.

More details on the scrutiny

One of the news outlet's sources said executives from over a dozen companies in a wide range of sectors have talked to DoJ investigators. The government has reportedly been probing Google's ad and search business since mid-2019.

In October, it filed a lawsuit against the company on allegations of using anti-competitive strategies to keep its search engine's dominance in the market. Regulators have continued to look into Google's ad practices.

They also asked the company's rivals if they ever saw behavior like or worse than the allegations brought by attorneys general from Texas and other states in a lawsuit in December. Google has defended its ad business, saying it helps companies grow while protecting the privacy of users.

Reuters' sources said if the DoJ sues Google for its ad practices, it could join the case led by Texas or file its own lawsuit. Texas amended its complaint on Tuesday, alleging that upcoming changes to Chrome "are anti-competitive because they raise barriers to entry and exclude competition" in digital advertising.