South Africa's Competition Tribunal Orders Google to Allow Lottoland Advertisements

The South African Competition Tribunal recently delivered a landmark interim order that marks a significant turn in the relationship between big technology firms and market competition in the country. In what can be considered a win for online gambling company Lottoland, the tribunal has mandated that Google Ireland Ltd and Google South Africa (Pty) Ltd cannot deny Lottoland advertising services on their Google Ads platform – a service critical in the fiercely competitive online betting industry.

Lottoland, which is recognized as a licensed bookmaker in South Africa, found itself at odds with Google when access to Google Ads was inexplicably cut off. The betting company asserted that this action not only caused financial damage but also distorted market competition. What fueled Lottoland's ire was the observation that rival firms continued to enjoy uninterrupted access to the advertising service.

The problem originated from Google's assertion that Lottoland's service, which involves placing fixed-odds bets on various lottery outcomes, violated South African law – specifically sections of the Lotteries Act. Although Google intends to protect users through its advertising policies, the tribunal found Google's argument weakened, particularly because Lottoland’s competitors were permitted to market similar services.

The heart of the issue, as the tribunal discovered, is Google's market dominance in online search and marketing – a dominance that Google has strenuously denied. The tribunal recognized Google Ads as a scarce service for which there is no practical substitute, setting high barriers for Google’s competitors in the advertising sector.

For Lottoland, the tribunal's decision could not have come sooner since they presented data showing a significant drop in new customer registrations following the block. The temporary ruling is essentially a necessary intervention to safeguard competition and consumer choice until a full hearing conclusively addresses the allegations of anti-competitive practices.

In a broader context, this decision impacts the larger debate on technology monopolies and their influence on market dynamics. As a provisional measure, it sheds light on what many smaller firms experience as they deal with giant tech corporations, and it could herald more scrutiny on how these corporations interact with other businesses that depend on their services.