Recently, EU competition commissioner Margrethe Vestager launched a formal accusation against Google. The search engine giant stands accused of antitrust violations in Europe. Charges were launched following a five-year investigation.
Key Charges against Google
Along with its search results, Google will also be investigated regarding whether the firm may have prevented other companies from developing competitive systems. The commission is also interested in whether Google may have illegally bundled or tied its services for Android in a manner that would require those services to be used together in an anti-competitive manner. Google is also accused of skewing search results in order to favour its own shopping service. If that is the case, it would be in breach of competition rules.
Google’s Response and Analysis
Now that the European Commission has sent a Statement of Objections to Google, the search for harm will begin. This is hardly the first time that the tech giant has fallen under scrutiny and likely will not be the last time, either. Although Google is certainly the most frequently used search engine, the commission may find it difficult to prove harm simply due to the fact that consumers now have more options available than ever before for finding and accessing information.
In order for allegations of harm to be substantiated, both competitors and consumers must be affected, and that simply may not be the case. In terms of choice, consumers are able to take advantage of numerous other search engines, including Yahoo, Bing, Quora, and many others. Additionally, there are many specialized services, such as Idealo, Amazon, Expedia, and others, that provide shopping services in the EU. Consumers are also taking far greater advantage of social sites, such as Pinterest, Facebook, and Twitter, for obtaining recommendations for everything from where to buy products to where to dine. Consumers even have greater availability of choice for where they obtain their news.
Dominance and Incorrect Search Results Could Be Used as a Weapon by the EU
With all of that said, the EU could still use Google’s market dominance as a potential weapon. Despite the many other search engine options available for consumers, Google comprises approximately 90 percent of the European online search market. According to the European Union, it is concerned that retail competitors of the tech firm, such as Yelp and TripAdvisor, could potentially be squeezed out of business due to Google’s market dominance. If the California-based Internet company is found to be culpable, it could face massive fines amounting to as much as 10 percent of its global turnover, which was more than $60 billion last year.
Where Does the Road Lead from Here?
For the moment, Google has received an extended deadline to respond to the accusations from the European Union. Whether the EU has the ability to fell the mighty search engine giant will only be proven by time. Over the past few years, antitrust regulators have attempted but largely failed to launch successful strikes at companies with significant market dominance. This has largely been because antitrust enforcement has been slowly gutted over the past couple of decades in the United States. What makes the current case against Google interesting and which could prove to pose more of a threat to the tech firm is the fact that the case is being launched not in the United States, but in Europe.