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Google’s And The EU’s Looming Antitrust Fistfight

Google and the European Union are on a collision course over the search giant’s allegedly monopolistic tendencies. And while Google has faced similar complaints – and been investigated – in the U.S. for violating antitrust violations, it seems the E.U. is more inclined to pummel Google than give them a light slap on the wrist.

If Google loses, it faces fines of $6 billion and the prospect of changing how its algorithm prioritizes search results (in the E.U. only).

Currently, the European Commission alleges, Google is using its search results to play favorite – choosing to prioritize firms that have advertised with Google rather than the most relevant result to the search term.

“It’s not based on the merits of Google shopping that it always comes up first in search,” Europe’s top antitrust official Margrethe Vestager said in an interview with CNN Money. “Dominant companies can’t abuse their dominant position to create advantage in related markets.”

And while team Google is not terribly excited by this news – the fines could amount to losing an entire quarter of profits – it probably is not coming as much of a shock either. The EC has been investigating Google’s business practices for the last half decade, and, CNN reports, at least two different commissioners have made “countless threats against the search company.”

Still, Google might have thought it would be able to slide with the European Parliament voting in favor of a non-binding resolution to break up Google; instead, the EC voted in a new competition commissioner.

Google is not alone in the mix with the E.U. among U.S.-based tech firms.

Vestager noted that her commission is trying to protect the interests of both innovators and consumers – further stating that a quarter of the firms lobbying against Google are U.S. based.

The case does not seem to address a central issue – Google is not always (or even most often) a consumer’s starting point. Google has pointed out that its shopping and travel sites are actually performing far below the level of competitors such as Amazon, eBay, Booking.com, TripAdvisor, Expedia and many other sites in Europe.

Google points out that its 90 percent share of the search market in the EU has not translated into anything even approaching a majority stake in the product search market. If the antitrust case is premised entirely around product search results – well, if Google were an illegal trust, one might think it would have managed to capture more of the marketplace.

“While Google may be the most used search engine, people can now find and access information in numerous different ways — and allegations of harm, for consumers and competitors, have proved to be wide of the mark,” stated Amit Singhal, Google’s search chief, in a blog post.

Google now has 10 weeks to officially respond to the EU’s complaint. If it chooses not to settle, the case could get tied up in court for years.

“[We] look forward to making our case over the weeks ahead,” Google said in a statement.

The commission is also looking into Google’s Android mobile operating system after a group of competitors accused the company of using it to “monopolize the mobile marketplace and control consumer data.”

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