The tech giant Google has already responded by saying it is “respectfully at odds” with the Brussels decision. The European Commission issued a statement on Tuesday that it has fined the tech giant Google, more specifically Alphabet, for violating European anti-competitive rules as imagined. The tech giant Google abused its dominant position in the market as a search engine by giving the illegal advantage to another Google product, its price comparison service.
But what was Google accused of?
The European Commission fined the tech giant Google for € 2.42 billion for breach of EU antitrust rules. Google abused its dominant position in the search engine market by giving an illegal advantage to another Google product, its own price comparison service. The investigation lasted for seven years and there were already many complaints of competition. The tech giant Google must end this practice within 90 days or incur monetary penalties that may go up to 5% of the average worldwide daily turnover of Alphabet, Google’s parent company. Margrethe Vestager, commissioner of the European Commission and responsible for competition policy said that “Google has created many innovative products and services that have changed our lives, which is a good thing! However, Google’s strategy for its price comparison service was not just about attracting customers by making its product better than its competitors. Instead, Google has abused its dominant position in the search engine market by promoting its own price comparison service in its search results and downgrading its competitors”. What Google has done is illegal under EU antitrust rules. It denied other companies the possibility of competing on their merits and of innovating. Most importantly, it denied European consumers a genuine choice of services and the possibility of taking full advantage of the benefits of innovation.
What evidence is collected?
In order to reach that decision, the Commission has collected and examined extensively a wide range of elements, including:-
- Recent documents from both Google and other market players;
- large amounts of real data, including 5.2 terabytes of Google search results (about 1.7 billion searches);
- experiences and surveys, which analyze in particular the impact of visibility on the results of the surveys on consumer behavior and viewing rates;
- financial and traffic data, which describes the commercial importance of visibility in Google’s search results and the consequences of appearing in a less prominent position; (5) extensive market research involving customers and competitors on the markets concerned (the Commission sent questionnaires to several hundred companies).
Consequences of the decision
The Commission’s fine of € 2.42 billion takes account of the duration and seriousness of the infringement. In accordance with the 2006 Commission Guidelines on fines, the fine was calculated on the basis of the value of Google’s revenue from its price comparison service in the 13 EEA countries concerned.
Other cases involving Google
The Commission had already reached the preliminary conclusion that Google abused the dominant position in two other cases, which are still under investigation:-
- The Android operating system, on which the Commission fears that Google has stifled choice and innovation in a range of mobile applications and services by pursuing a global strategy on mobile devices to protect and expand its position Dominant in general Internet searches;
- AdSense, for which the Commission fears that Google has narrowed the choice by preventing third-party websites from having access to ads from Google’s competitors. This is the biggest fine ever applied to the company. Recall that in 2009 a fine was imposed on Intel of 1.06 billion euros (which was so far the highest fine imposed on a company). So, what do you think about this? Simply share your views and thoughts in the comment section below.
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