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Thursday, April 16, 2015

Europe’s Case Against Google

Europe is taking on Google, accusing the U.S. search giant of violating the bloc’s antitrust laws, charges that the company has denied. Here’s what you need to know.
1.What's the complaint against Google?
The European Commission accuses Google of giving systematic favorable treatment to its own comparison shopping service called Google Shopping in its general search results page, hindering the ability of rival comparison shopping services to compete. The commission said such conduct infringes EU antitrust rules because it stifles competition and harms consumers. The commission also opened a formal probe aimed at Google’s Android operating system for mobile phones, saying it will investigate whether Google has entered into anticompetitive agreements.

2.Why does it matter if Google does this?
Google is a huge company with products like YouTube, Maps, Gmail and maybe soon driverless cars, but search is still at the heart of its business. And Europeans overwhelmingly use Google to search the Internet—more than 90% of searches go through Google, compared with about 75% in the U.S., according to Statcounter, an analytics company. That means it has more responsibility under competition rules.
3.Hasn't this been going on forever?
The European Commission has been investigating the issue for five years. The two sides almost settled three times. Now, new leaders at the Commission aren’t negotiating a new settlement, and instead issued a formal complaint that could go to court.
4.Who's pushing for this?
Google’s competitors, including Microsoft, Yelp, Expedia, TripAdvisor and Nokia. They say Google has an unfair advantage that prohibits their products and services, like maps and search engines, from gaining traction.
5.What does Google say?
In a statement posted online, Google said it looks forward “to making our case over the weeks ahead.” Google has consistently denied any anticompetitive behavior, and said Wednesday that people can now find and access information in numerous different ways. “Allegations of harm, for consumers and competitors, have proved to be wide of the mark,” the company said in a blog post. It said there was “a ton of competition” in online shopping sites such as Amazon and eBay. Regarding the Android probe, Google said far fewer Google apps are pre-installed on Android phones than Apple apps on iOS devices.
6.What could happen to Google?
Some politicians have suggested the EU should force Google to split its search page from its other commercial functions, sometimes called unbundling. Google can now respond to the commission’s statement of objections, and try to resolve the problems out of court. If it goes to court and Google loses, the EU can fine Google up to 10% of its global annual revenue and impose conditions on how it does business in Europe. That could, experts say, have a knock-on effect on how Google operates in other jurisdictions.
7.So is this bad news for Google?
While a settlement is always possible, some say Google actually would rather this go to court—where it could be tied up for years, as Google continues to solidify its dominant position. And it could eventually win. A U.S. federal judge recently dismissed a similar case involving Android, Google’s operating system.

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