In a move that intensifies the global scrutiny of Google’s dominance in the online advertising industry, Canada’s Competition Bureau has launched a lawsuit against the tech giant, accusing it of anti-competitive practices in the country’s digital advertising market.

The Bureau filed an application with the Competition Tribunal on Thursday, seeking to compel Google to sell two of its advertising technology tools and pay a financial penalty for violating Canadian competition laws.

This legal challenge is part of a broader wave of antitrust actions Google is facing worldwide. With similar cases ongoing in the United States and Europe, the stakes for Google’s advertising empire, which forms the backbone of its revenue, have never been higher.

The Competition Bureau claims that Google has abused its dominant position as the largest provider of advertising technology services in Canada. According to the Bureau, Google’s practices were intentionally designed to stifle competition and consolidate its market power, reducing choices for advertisers and publishers.

The Bureau stated that Google had abused its dominant position through conduct intended to ensure that it would maintain and entrench its market power.

The lawsuit seeks remedies that could significantly disrupt Google’s operations in Canada, including requiring Google to divest two key ad tech tools and imposing financial penalties to ensure compliance with Canadian competition laws. If successful, this legal action could set a precedent for tackling monopolistic practices in the digital advertising industry.

Google’s Defense

Google has dismissed the allegations, framing the Canadian Competition Bureau’s lawsuit as overlooking the competitive nature of the online advertising market. Dan Taylor, Google’s Vice President of Global Ads, defended the company’s practices, stating, “Our advertising technology tools help websites and apps fund their content and enable businesses of all sizes to effectively reach new customers.”

Taylor added that ad buyers and sellers have numerous alternatives in a market that remains highly competitive. This defense mirrors Google’s arguments in similar cases abroad, particularly in the United States and Europe.

Global Antitrust Cases Against Google

The Canadian lawsuit is not an isolated challenge. It comes at a time when Google is grappling with high-profile antitrust cases in other jurisdictions, all of which could have profound implications for its advertising business.

In the United States, the Department of Justice (DOJ) has accused Google of monopolizing key segments of the ad tech industry, including publisher ad servers and advertiser ad networks. This lawsuit, which recently concluded its closing arguments, argues that Google’s practices harm competition and innovation. The DOJ is seeking to force Google to divest its Chrome browser, a key component of the tech giant’s ad revenue.

Google, in turn, has countered that the DOJ cherry-picked its allegations and ignored the dynamic competition in the ad tech market.

In the European Union, earlier this year, Google attempted to address a separate antitrust investigation by offering to sell its ad exchange operations. However, European publishers rejected the proposal, deeming it insufficient. Regulators in the EU have intensified their scrutiny, particularly around Google’s dominance in digital advertising.

These cases represent a cumulative threat to Google’s advertising model, which generated $237.9 billion in 2023—accounting for roughly 80% of the company’s total revenue.

Potential Consequences for Google’s Ad Revenue

The stakes of the cases for Google are monumental. Should any of these countries succeed in their antitrust actions, the tech giant could face substantial operational changes and financial losses.

Forced divestments could lead to the loss of crucial components of its advertising ecosystem, disrupting its ability to offer integrated services that attract advertisers. Financial penalties could impact Google’s profitability, while successful cases in one jurisdiction could embolden regulators worldwide, leading to additional lawsuits and heightened scrutiny.

For Canada, this could mean a fairer playing field for advertisers and publishers. However, for Google, it signals a growing challenge to its dominance in one of the most lucrative sectors of the digital economy.