The EU’s chief competition regulator alleged today that Google is illegally abusing its dominant position in the search market.
Antitrust commissioner Margrethe Vestager has now taken the first official step towards fining the ad-slinging search monster.
“I am confident that Google has artificially boosted its position in the search results so that users do not see what is most relevant for them to see,” she said.
The EU Commission believes the company has abused its dominant position in the markets for general internet search services by systematically favouring its own shopping comparison product in its general search results pages.
“Google now has the opportunity to convince the Commission to the contrary. However, if the investigation confirmed our concerns, Google would have to face the legal consequences and change the way it does business in Europe,” continued the commish.
“We don’t want to interfere with screen design, how things are presented on the screen as such or the algorithm. What we are concerned about is that people see the most relevant shopping results,” continued Vestager.
The Commission has also formally opened a separate antitrust investigation into Google's conduct with Android. The investigation will focus on whether Google has entered into anti-competitive agreements or abused a possible dominant position in the field of operating systems, applications and services for smart mobile devices.
Vestager said that the only reason she was focussing on search first was because that was where they had received a formal complaint, however she added that the outcome of the search case could set a precedent
The case has rumbled on for more than five years as Vestager’s predecessor repeatedly tried and failed to reach a settlement with the Chocolate Factory. Google is accused of abusing its dominant position in the European search market, systematically directing users to its own services, imposing restrictive contracts on advertisers and scraping content from other sites.
“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,” said Vestager.
A leaked internal memo from Google described the move by the European Commission as “very disappointing news” but sought to reassure staff that Google would have time to tell its side of the story.
Despite holding out hope that “the back-and-forth” can take a year or two, that the Commission might modify its claims or settle the case, Google warned staffers to “expect some of the criticism to be tough.”
“We have a very strong case, with especially good arguments when it comes to better services for users and increased competition. The competition is just one click away — and it’s growing. People can use Bing, Yahoo, Quora, DuckDuckGo, and a new wave of search assistants,” said the memo, clearly setting out the arguments it intends to use with the Commission.
That will cut no ice with the complainants. Shivaun Raff, director of Foundem, one of the first companies to file a formal complaint to the EU, claimed: “Google is not just a monopoly; it is probably the most powerful monopoly in history. As the gatekeeper to the Internet, Google plays a decisive role in determining what the vast majority of us read, use, and purchase online.”
“Today’s announcement isn’t about the potential size of any eventual fine,” continued Raff, “it is about ending Google’s ability to manipulate its unprecedented power to its own financial ends and to the detriment of consumers and innovation.”
The Statement of Objections comes after five years of probing and questioning by the EU Commission. ®