• The Federal Trade Commission has launched an investigation into the search advertising practices of Amazon and Google.
  • The probe raises significant antitrust and privacy concerns in the digital advertising market.
  • The action follows a recent federal court ruling that found Google in violation of antitrust statutes.

The Federal Trade Commission is actively investigating Amazon and Google over their search advertising practices, according to people familiar with the matter, a move that significantly escalates regulatory pressure on two of the world's largest tech companies.

This probe, which centers on potential antitrust and privacy violations, follows a major legal development in August 2024 when a federal judge found Google in violation of antitrust statutes for maintaining monopolies in search services and search advertising. The FTC's investigation is now examining whether similar anti-competitive dynamics are at play in Amazon's sprawling digital ad business.

Regulators are particularly focused on how both companies leverage their dominant market positions—Google in general search and Amazon in product search—to potentially disadvantage competitors and manipulate advertising markets. The Department of Justice has already proposed that Google share parts of its search index, user, and ads data with competitors under stringent privacy safeguards, a position the FTC supports in an amicus brief that emphasizes both competition and privacy concerns.

Spokespeople for Amazon and Google did not immediately respond to requests for comment. The companies have historically defended their practices as fair and beneficial to both consumers and advertisers.

The investigation occurs amid a broader shift in the digital advertising industry, with increased focus on privacy, transparency, and competitive dynamics as new regulations emerge worldwide. For both companies, digital advertising remains a key revenue driver, with their cloud and ad segments posting substantial year-over-year growth despite broader economic headwinds.

Short-term, both companies face the prospect of ongoing litigation, potential fines, and possible court-mandated changes to business practices. In the long-term, a successful FTC and DOJ action could lead to structural changes in the digital ad market, more robust privacy safeguards, and increased competition, including mandated data-sharing with competitors under independent oversight.