“The European Union’s antitrust chief hit Google with a record $2.7 billion fine Tuesday, saying the powerful Web search leader illegally steered users toward its comparison shopping site and warning that other parts of Google’s business were in the crosshairs.”
-Michael Birnbaum and Brian Fung, Washington Post, June 27, 2017
The E.U. is giving notice that tech is no longer immune. EU antitrust regulators have proposed the largest fine they’ve ever levied “against a company for abusing its dominant position.”
In its defense, Google has relied on the same old saw other tech companies stood upon when their monopolistic tendencies were challenged. They say they’re only helping consumers by making it easier to find what they want—allegedly by diminishing consumers’ ability to find competing products.
The Washington Post quoted Google senior vice president and general counsel, Kent Walker: “When you shop online, you want to find the products you’re looking for quickly and easily. And advertisers want to promote those same products. That’s why Google shows shopping ads, connecting our users with thousands of advertisers, large and small, in ways that are useful for both.”
Kool Kidz tech companies like Apple and Google have always positioned themselves as above mere commerce. They were changing our lives, democratizing online spaces, paving the road to a digital Shangri-La.
However, their halos are fading. They have been revealed as commercial juggernauts, willing to do whatever it takes to fluff the bottom line—just like any other multi-billion-dollar international conglomerate. Apple’s treatment of overseas factory workers has made headlines all over the world. Google faced regulatory scrutiny from U.S. anti-trust authorities in 2012, when FTC investigators found that the company’s “conduct has resulted — and will result — in real harm to consumers and to innovation in the online search and advertising markets.”
The FTC did not file an anti-trust lawsuit, saying that the evidence did not meet the standards that would justify such a move. However, according to documents obtained by The Wall Street Journal, investigators stated that Google forced companies to allow the search giant to use their content in search results by threatening to ban them from Google search results altogether.
According to CNET: “The documents reveal that Google was accused of stealing content from Amazon, TripAdvisor and Yelp to bolster its competing services. In the case of Amazon, for instance, Google allegedly copied the e-retail giant’s sales rankings and placed them on its own shopping service to rank items. Google also allegedly copied Amazon’s reviews for those products.
After allegedly discovering a similar move, TripAdvisor and Yelp asked Google to stop its activity. The search company quickly denied the request and threatened to remove their services from search, according to the Journal’s report.”
Per The Wall Street Journal, FTC Investigators wrote: “It is clear that Google’s threat was intended to produce, and did produce, the desired effect which was to coerce Yelp and TripAdvisor into backing down.”
The Journal also claims that the report includes a message sent by Google telling competitors that it would “extract the fruits of its rivals’ innovations.”
This information may have helped sway EU regulators, and hopefully, even the threat of such a huge penalty will let tech giants know that the free monopolist ride may be over.
—Leonce Gaiter | Vice President, Content & Strategy