Monday, April 29, 2013
Google Floats Antitrust Concessions To EU
Story originally appeared on Information Week.
Google Nexus 7, Take Two: What To Expect (click image for slideshow) To resolve European antitrust concerns, Google has proposed four ways it is willing to change its business practices, and the European Commission on Thursday solicited feedback on the proposal.
Following its two-and-a-half-year investigation of Google's business practices, the Commission concluded that Google may be violating EU antitrust rules by: giving preference to Google services in search results; using third-party original content in its own specialized search services; requiring online publishers running Google ads to forgo ads from rivals; and contractually limiting the transfer of ad campaign data to rival search ad platforms.
In response, Google has committed to a series of concessions that, if accepted, will change the way the company operates. Google states that its proposal is not an admission of competition rule violations. Rather, the company says it is willing to modify its business practices "to avoid the time, inconvenience and expense of ongoing proceedings ..."
Google is offering: to label and visually separate links to its specialized search services (like flight search) that it promotes in general search results lists, and to promote three rival specialized search services in a clearly visible area; to allow specialized search services (like Yelp) to prevent Google from using their content in its own specialized search service (like Google Local), and to give news publishers page-level control of Google News inclusion; to stop requiring that publishers use Google ads exclusively; and to drop its advertising API restrictions.
In January, Google settled a Federal Trade Commission inquiry with fewer concessions. At the time, FairSearch.org, a lobbying group backed by Microsoft, Nokia, Oracle, and online travel and marketing companies, complained that the FTC's inaction would embolden Google to further abuse its monopoly power.
The group doesn't sound much happier with Google's latest proposal. Thomas Vinje, counsel and spokesman for FairSearch Europe, said in a statement that while the group welcomed the Commission's findings, "Google's proposed commitments appear to fall short of ending the preferential treatment at the heart of the Commission's case ..."
While FairSearch argues for stronger remedies to curb Google, the European Commission felt the need to explain why it's being harder on Google than the FTC was in the U.S. "The factual and legal environments are different in the U.S. and Europe," the Commission explained on its website. "In particular, Bing and Yahoo represent a substantial alternative to Google in Web search in the USA: their combined market share is around 30%. In contrast, Google has been holding market shares well above 90% in most European countries for a number of years."
Over the course of a month, the European Commission will test Google's proposed changes in the market while accepting public comment. If the changes achieve the desired results, the Commission will issue a decision making them legally binding. If Google then violates its agreement, it could face fines of up to 10% of its annual worldwide revenue.