advertisers and agencies. Google also declared that a significant proportion of its customers target an audience outside their home country44.
The results of the market investigation demonstrate that, both for advertisers and for publishers, notwithstanding that technically this market could be EEA-wide, there are many factors which, from a commercial point of view point to a distinction of national or linguistic sub-markets. Supplying or buying of advertising space is differentiated on the basis of national preferences, languages, and cultural specificities. Lastly, in general support and sales networks are locally present in different countries.
It can therefore be concluded that the market for online advertising space is to be considered as divided alongside national or linguistic borders within the EEA. The same conclusion would apply to the alternative hypothetical narrower markets for search and non-search.
Intermediation in online advertising
The notifying party submitted that the market for intermediation should be considered at least EEA-wide. It argued that, in the light of low technological barriers, the costs of geographic expansion for intermediaries would be low.
The Commission's investigation has confirmed that the relevant geographic market for intermediation in online advertising is (at least) EEA-wide. Firstly, from a technical point of view, intermediation services can be provided online on a cross-border basis. Secondly, country or language specificities are of much smaller significance for online ad intermediation than for online advertising, which is considered as commercially distinguished alongside national or linguistic borders. Since intermediaries have an interest in increasing the number of customers belonging to their network or exchange, the intermediation activity frequently aims at reaching and attracting publishers and advertisers in various countries. Such geographic expansion to various Member States successfully occurs because the intermediation service does not depend on the different "content" of the intermediated advertisements.
The market investigation has provided several examples of ad intermediators which started their activities in one country and subsequently expanded to a number of Member States. Such is the case of two of the leading online ad intermediation companies, namely TradeDoubler and AdLink, that have expanded their business activities from their respective home countries, Sweden and Germany, across many European countries. The market investigation further indicated that intermediaries in general consider a local presence in each country as advantageous but not necessary. Accordingly, the Commission's market investigation has shown that several EEA based ad networks and ad exchanges operate their servers from one or only a few Member States.
[…%]* of advertising spending at Google in 2006 by advertisers with an EU billing address occurred outside the Member State in which the advertiser was based.