The South Korean Fair Trade Commission (FTC) has launched a fact-finding effort concerning Google’s alleged unfair practices. (Image courtesy of Yonhap)
SEJONG, Nov. 7 (Korea Bizwire) – The South Korean Fair Trade Commission (FTC) has launched a fact-finding effort concerning Google’s alleged unfair practices, which include monopolizing the digital advertising market and engaging in ‘gapjil,’ a term referring to an arrogant and authoritarian attitude or actions by individuals or businesses in positions of power.
According to industry sources on Monday, the FTC commissioned research on the digital advertising market.
On the surface, the purpose of this research is to analyze the overall structure and operational state of the digital advertising market. However, in reality, it is aimed at scrutinizing Google, which holds a dominant position in the market.
The objective is to determine if Google, while increasing its market share in the domestic search advertising market, has engaged in unfair practices, such as obstructing transactions with other businesses or exhibiting ‘gapjil’ behavior based on its significant market presence.
Some industry observers have suggested that the FTC’s actions represent advanced preparatory work to assess the current situation before launching a comprehensive investigation against Google.
Competition authorities in the U.S. and Europe have stepped up the pressure, saying Google should break up its digital advertising business.
The FTC previously conducted a survey on the overall digital advertising market in Korea in 2021. The investigation was aimed at determining whether the growing influence of big data-enabled platform companies in the digital advertising market is leading to new types of abuses.
The FTC conducted in-depth interviews with executives of advertisers and advertising agencies, website operators and app developers that display digital ads, and analyzed the terms and conditions of platform companies.
This latest investigation will focus on Google alone among the platform giants. Some have suggested that this is an indication that the FTC believes that Google’s advertising behavior is in fact problematic and has begun a full-scale investigation.
Google’s advertising practices have already undergone legal scrutiny in various countries overseas and have led to lawsuits, so it is possible that similar unfair behavior has occurred in Korea. In 2019, Google was fined nearly 2 trillion won by the European Union (EU) for forcing advertisers to pay extra for advertising on competing search engines.
An FTC official played down speculation that Google was in the crosshairs, saying, “We cannot confirm the content of the research or whether it specifically targets a particular company.”
Kevin Lee (kevinlee@koreabizwire.com)
