UK regulator will investigate Google’s plan to retire third-party cookies

Publishers have claimed Google's Privacy Sandbox will entrench the search engine and digital advertising giant's market power

Google’s plans to retire third-party cookies from its Chrome browser may have hit a snag with news the UK’s Competition and Markets Authority (CMA) is investigating the proposal to assess whether it will distort competition.

It comes after complaints of anti-competitive behaviour by Google and that the changes could further concentrate advertising spend in the Google ecosystem and entrench its market power.

The CMA has received complaints including from Marketers for an Open Web, a group of newspaper publishers and technology companies, which allege that, through the proposals, Google is abusing its dominant position.

Google wants its Privacy Sandbox to be private by default as an ecosystem. This approach involves three central initiatives: Replacing the functionality of cross-party tracking, disable third-party cookies and mitigating privacy reducing alternatives.

To provide functionality such as personalisation and single sign-in without cookies, Google is proposing trust tokens to combat fraud and spam, aggregated reporting for ad measurement, contextual first-party data for ad targeting, a privacy preserving WebID, creating first-party datasets and limiting other forms of tracking such as fingerprinting, browser cache inspection and network-level tracking.

The CMA was already considering Privacy Sandbox, in conjunction with the UK’s Information Commissioner’s Office (ICO) and Google. However, given the concerns raised by the complainants, it has decided this work should be conducted in the context of a formal investigation. The investigation will assess whether the proposals could cause advertising spend to become even more concentrated on Google’s ecosystem at the expense of its competitors.

The CMA wants any changes to address legitimate privacy concerns without distorting competition and it has been engaging with Google to better understand its proposals. Its investigation will provide a framework for the continuation of this work and, potentially, a legal basis for any solution that emerges.

The CMA said at this stage it has an open mind and has not reached any conclusions as to whether or not competition law has been infringed. It will continue to engage with Google and other market participants to ensure that both privacy and competition concerns can be addressed as the proposals are developed.

“Google’s Privacy Sandbox proposals will potentially have a very significant impact on publishers like newspapers and the digital advertising market. But there are also privacy concerns to consider, which is why we will continue to work with the ICO as we progress this investigation, while also engaging directly with Google and other market participants about our concerns,” said CMA chief executive, Andrea Coscelli.

Follow CMO on Twitter: @CMOAustralia, take part in the CMO conversation on LinkedIn: CMO ANZ, follow our regular updates via CMO Australia's Linkedin company page, or join us on Facebook: https://www.facebook.com/CMOAustralia.

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