Saturday 1 October 2016

EU competition commissioner 'concerned' Google is rigging its search engine

Published 15/04/2015 | 02:30

The EU is throwing the legal book at Google, with competition commissioner Margrethe Vestager formally accusing the search giant of rigging its search engine and its Android smartphone system to disadvantage rival firms.

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"In the case of Google I am concerned that the company has given an unfair advantage to its own comparison shopping service, in breach of EU antitrust rules,” said EU Commissioner for competition Margrethe Vestager.

“I have also launched a formal antitrust investigation of Google’s conduct concerning mobile operating systems, apps and services.

"Smartphones, tablets and similar devices play an increasing role in many people's daily lives and I want to make sure the markets in this area can flourish without anticompetitive constraints imposed by any company."

The investigation could result in multi-billion euro fines and new limitations on Google’s business activities in the lucrative EU market.

“Google now has the opportunity to convince the Commission to the contrary,” said Ms Vestager. “However, if the investigation confirmed our concerns, Google would have to face the legal consequences and change the way it does business in Europe."

Google is set to be accused by Europe's anti-trust regulator of illegally using its dominant search engine to stifle competition.

The move could see the internet giant fined up to $6.6bn (€6.2bn) over an alleged practice of highlighting its own services in influential search results at the expense of rivals.

Google chairman Eric Schmidt last year said that contrary to any claim, "Google is not 'the gateway to the internet'."

He added: "Nor is it true that we promote our own products at the expense of competitors… if you want to buy something, whether it is shoes or insurance, we try to show offers and websites where you can actually buy things."

The EU investigation is one of the most high-profile competition cases of recent years and comes amidst a wave of political opposition in Europe to the perceived dominance of US tech companies.

Google's rival Microsoft has been hit with total EU fines of more than €2.2bn over the past decade.

Counsel for Fair Search Europe Thomas Vinje said if the investigation is successful in finding Google guilty of rigging their searches, they could be fined up to ten per cent of their global annual revenue.

"I would expect Google, as others have done in the past in similar situations, to fight this rather hard," Mr Vinje told RTE Radio One.

"They will undoubtedly claim they are not dominant, I would be extremely surprised if that was to succeed.

"They could suggest they own the page and are entitled to do what they wish with it. Others have run in the past with this defence, but there has not been much success.

"To resolve the issue is quite straightforward, all Google needs to do is compete on the merits and treat everyone the same way. If Google wins on the merits alone and it wins on the results and its services are the cheapest to customers, it should win and should be able to win," he continued.

"But today it is biasing results against the interest of consumers and for its own profits.

"If there is no agreed result, which is a possibility, there is likely to be a fine imposed on Google.

"They could theoretically fine them up to 10 per cent of their global annual revenues. It has not reached that in the past, but it could certainly be up in the range of a couple of billion euro.

"But fines are far from the most significant thing here, the real question is the conduct of Google's business."

Google has a major presence in Ireland, having arrived here in 2003 as a five-person operation in small offices in Dublin's Earlsfort Terrace.

The business developed rapidly to employ a workforce of more than 2,500 and is central in the country's foreign direct investment strategy, alongside other tech giants who set up here like Facebook and Twitter.

It has moved to a new campus on Barrow Street where it created a HQ for all of its operations in Europe, the Middle East and Asia (EMEA).

Irish Independent

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