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E-Commerce

EU Still Unhappy with Google Dominance, Threatens Lawsuit

EU Still Unhappy with Google Dominance, Threatens Lawsuit
January 16, 2014 10:08AM

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Google has been dealing with the antitrust allegations since 2010, when EU regulators first voiced concerns regarding the search engine's control of the industry. During the past four years, Google has increased the scope of its proposed fixes. But every time, its competitors have told regulators that the proposed resolutions would not be enough.

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The European Union is not backing down in its antitrust case against Google. The EU's watchdog says Google is abusing its dominance in the search-engine industry. The two parties involved have been talking about possible resolutions, but the EU now says Google will have to provide an adequate proposal in coming weeks or the EU will move forward with a traditional antitrust case and punishment.

EU watchdog chief Joaquin Almunia said Wednesday that unless Google can make changes to its search engine business strategy soon, it could face billions of dollars in fines and an antitrust lawsuit, which could take years to resolve.

Outside Opinions

One of the more controversial aspects of the case has been the involvement of Google's competitors in the EU's decision-making process. EU regulators have even referenced opinions of Google's competitors when talking about their decision to not accept the search giant's proposals thus far.

"I am waiting for the reaction from Google," Almunia said at a news conference. "Unfortunately after the second round of proposals, I am not satisfied. We need more. And we need more not in the next year, but in the next few weeks."

Google has been dealing with the antitrust allegations since 2010, when EU regulators first voiced concerns regarding the search engine's control of the industry. During the past four years, Google has continued to increase the scope of its proposed fixes but every time, its competitors have told regulators that the proposed resolutions would not be enough to solve the problem.

"I believe Google's market dominance is the primary reason the company is being subjected to this level of scrutiny," said Charles King, principal analyst for Pund-IT. "For many regulators, market share and competitive success determine the size of the target affixed to the company under the microscope."

Complaints

The entire EU antitrust case against Google has been based on the fact that it controls 90 percent of the market in Europe. Its competitors have long complained about its market dominance. But according to EU law, there is nothing inherently wrong with being popular in a certain industry. However, Almunia is claiming that Google has abused its dominance by promoting its services and products above those from competitors.

King told us the larger issue percolating below the surface is more cultural in nature. The U.S. Federal Trade Commission decided against pursuing a similar case against Google.

"The EU has a history of pursuing antitrust cases and punishments far more rigorously than virtually any other region," he said.

In order to fix these issues for European searchers, Google proposed that it would clearly label its promoted search results and that it would allow competitors to buy second-row search results. Near the end of 2013, the EU stated that it would not accept Google's resolutions based upon concerns that they would only force businesses to spend money while not decreasing Google's market share.

Tell Us What You Think
Comment:

Name:

Ian Waring:

Posted: 2014-01-18 @ 9:15am PT
Joaquin Almunia is a legend in his own lunchtime. Name any consumers who have complained? This guy is clearly out of his depth if all he can recite is competitors voices that want "more" without any specifics. He is not doing a competent job on behalf of the consumers that should be his only constituency.

IP Core:

Posted: 2014-01-16 @ 9:00pm PT
Google Apps are a clear violation of anti trust laws



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