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UE ultimatum to Google

  • The Search Giant Google, accused of abusing its dominant position by UE Commission for Competition, could pay a 3 billion dollars fee.

The EU's antitrust investigation on Google, launched in November 2010, after about 2 years is coming to an end, with an ultimatum. The European Commissioner for Competition, Joaquín Almunia, last 21st May, sent a letter to Google giving the company the opportunity to offer “remedy proposals” that would avoid lengthy proceedings.

The accusation, launched in the beginning by 3 companies of the sector to UE and USA authorities, has involved more than a dozen complaints. In the first line, stands Microsoft, owner of the second more popular search engine in the world (Bing), followed by lots of travel website (Tripadvisor, eDreams, Expedia)

Google now counts 80-90% of the search engine market and takes over 40-50% of total online ad spent, which is valued around 80 billion dollars in 2011. In this scenario, Google is accused of abusing its dominant position in the market for web search engines, giving a preferential treatment to its products (Google News, YouTube, Google Shopping, Google AdWords).

Specifically, Commissioner highlights four areas of concern:

  1. Inclusion of Google's products (e.g. News, YouTube, etc.) in prominent positions among search engine results, giving them a preferential treatment compared with those for competing services;
  2. Insertion of copied content (for example user reviews) from competing vertical search services in Google’s results without asking any permission, damaging rival sites;
  3. Existence of agreements between Google and partners of websites on which Google delivers advertisements, leading to exclusivity as they restrain other publishers to obtain similar advertising services;
  4. Presence of restrictions on the portability of online search advertising campaigns run on Google AdWords to the platforms of Google’s competitors.

The official reply of Google to the Commission is: “We disagree with the conclusions but we're happy to discuss any concerns they might have”. So, the Commission has decided to give Google the opportunity to offer remedies to concerns identified.

If BigG won’t react properly soon and if it will be found guilty of abusing its dominant position, Google could be fined 3 billion euros.

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