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The search company could get stuck with a fine of $5 billion if it can't convince the EU to settle

Google may have gotten out of the U.S. Federal Trade Commission (FTC) antitrust investigation without much of a penalty earlier this year, but the European Commission isn't giving in so easily

European Competition Commissioner Joaquin Almunia said that Google's proposal for ending the investigation wasn't going to cut it. 

"I concluded that the proposals that Google sent to us are not enough to overcome our concerns," said Almunia. 

The European Commission opened a formal antitrust investigation into Google's search behavior in November 2010.

In May 2012, the European Commission said that Google should submit changes in how its search results are wired. Google said it would in February of this year.

In April, Google submitted a settlement proposal that didn't change the algorithm used to create its search results. Rather, the company opted to clearly label any search results from its own services. Not only that, but in some instances, Google will offer links from rival search engines. 

More specifically, services where Google doesn't make money from search results (like weather and news) would have been labeled as Google services. For places where Google sells ads, links to at least three competitors would've been displayed. For services like Google Shopping, links to rivals would be auctioned.

In addition, the proposal aimed to give websites the option to keep their content from vertical search properties, but stay in general search results. Furthermore, Google wanted to help small businesses move their ad campaigns to other search engines.

While the European Commission initially accepted this proposal, Google rivals like Microsoft weren't happy with the proposal. Microsoft said that Google is a determining factor as to what Europeans search, read and purchase online (about 86 percent of Europeans use Google for search) and that its practices are only benefitting itself; not consumers and fair competitors. 

It was announced in late April that Google competitors had one month to comment on the EU invesitgation, and it looks like Google's rivals voiced their opinions against Google's proposal. 

It's not clear when Google has to respond to the EU's latest decision, but the search company could get stuck with a fine of $5 billion if it can't convince the EU to settle. 

In January of this year, Google managed to escape a two-year FTC investigation with no fines. The investigation looked into Google's possible abuse of search dominance as well by using results to its own advantage.

Source: Reuters

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RE: I'm confused
By TSS on 7/17/2013 7:24:28 PM , Rating: 4
It's not that the EU citizens aren't happy with google.

On the contrary, they've been so happy with google that basically all local language search engines have died out. Their results just wheren't relevant compared to what google brings to the table.

That's lead to a vicious cycle though. People will just continue to use google as long as it meets there needs. They will not seek out other search engines that might give better results after a few more years of development. Which in turn leads to no investment into search engines as it's not profitable.

That's more or less what the EU is trying to force, exposing multiple search engine options to the general public. Then, if you build one better then google, it'll get noticed and thus be financially viable and thus more effort will be put into innovation.

For all of the EU bashing that goes on (and belive you me, there's plenty of that to go around here in europe as well), the EU commission does do a few good things. And the $5 billion mark, well, a big company deserves a big fine. They're not gonna feel a couple million.

RE: I'm confused
By chimto on 7/17/2013 8:11:43 PM , Rating: 2
Your description of the situation sounds as if the EU is fining google just because they have a large market share.

I don't quite understand what google is doing that might deserve a $5 billion dollar fine and I don't know all the details of the investigation. But if the EU is just handing down fines to companies that are large or have large market share for no reason other than the fact that they are large companies, to me that seems plain wrong.

RE: I'm confused
By Alexvrb on 7/17/2013 8:39:16 PM , Rating: 2
Your description of the situation sounds as if the EU is fining google just because they have a large market share.
Yeah, well the truth ain't always pretty.

RE: I'm confused
By Azethoth on 7/17/2013 9:24:14 PM , Rating: 2
IANAL, but I believe the origins of this batch of suits were from companies similar to ehow and and similar SEO schemes.

They add nothing to your google search except crappy links to their crap site that if you click on it, gives you a bunch of useless crap + the ads they then make money off of.

Rightfully Google punishes these useless parasites in their search algorithm. In turn this is considered unfair.

As a google search user though I do not care, I do not want to see that crap and so I use some plugins to wipe the crap away.

Meanwhile, they get butt hurt when the algorithm roots them out and go cry to the EU and FTC. Then MS and other big companies fund their crying and we end up with Google getting extorted for no good reason.

RE: I'm confused
By Azethoth on 7/17/2013 9:27:13 PM , Rating: 2
Damn damn damn. I could have worked crapnado into that post.

RE: I'm confused
By Reclaimer77 on 7/17/2013 8:15:12 PM , Rating: 2
And the $5 billion mark, well, a big company deserves a big fine.

Deserves? For doing what?

In your own words Google's "crime" here is doing a good job. Such that, people willingly and knowingly sought out their service over others.

Wow man, that's the crime of the century right there! Fine them BILLIONS!?

That's more or less what the EU is trying to force, exposing multiple search engine options to the general public.

Uhh how is the EU doing that here? Are they going to use this money to fund websearch startups? Are they doing to use it to advertise for other search engines? Hire more developers?

The answer to these questions is NO. They are keeping it, it's going straight into the EU's shakedown coffers. This is NOT about the "general public".

RE: I'm confused
By Nephiorim on 7/18/2013 3:50:36 AM , Rating: 2
As soon as a company enters monopoly territory they're under scrutiny by the EU. Keep in mind, the EU wanted to agree to the earlier deal, but after bitching by other companies such as Microsoft for being unfair they took another look. Last I checked Microsoft was American as well by the way. You're calling this a shakedown, I'm calling it American companies abusing yet another legal system to stifle innovation and hurt each other. Only difference is this time they crossed the pond to do it.

In addition it's not about Google obtaining such a market share, it's what they do when they have it. Apparently they manipulated search results, thereby abusing the monopoly position they're in. This leads, or has led, to an unhealthy market and yes us Europeans are fan of heavy markets and feel at least some regulation should be in place for this to happen. Here's probably where we have a difference in ideology so that's where the whole argument will stall most likely, but let's see where we end up shall we? :)

RE: I'm confused
By Nephiorim on 7/18/2013 3:54:44 AM , Rating: 2
I would also like to add that the money flows into EU funds yes. It would cost way more to find out which individual persons were actually harmed by these practices so in general they flow into the big pot so every citizen in the EU gets to pay slightly less taxes. More efficient way of doing it I suppose, but not the fairest :)

RE: I'm confused
By Strunf on 7/18/2013 7:41:38 AM , Rating: 2
You miss the point, the fact is that in the EU companies can be fined up to 10% of their revenue, if a company is found guilty of something it's only natural that they pay in proportion to their size if that wasn't the case then the law would mean nothing for big companies.

RE: I'm confused
By spamreader1 on 7/18/2013 9:35:34 AM , Rating: 2
That at least has me less confused, thanks. I don't necissarily agree with the primise that all newer potentially better search engines are being muscled out without proof should constitute penalizing successfull companies. Then again I'm niether a lawyer, nor even a business major so I'm sure my understanding of such situations is quite limited.

“And I don't know why [Apple is] acting like it’s superior. I don't even get it. What are they trying to say?” -- Bill Gates on the Mac ads

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