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Even if Google can settle it faces numerous more antitrust probes on other topics in the EU and U.S.

On Monday, Jonathan Todd, spokesman for the European Commission (EC) -- the European Union's (EU) market regulatory watchdog -- revealed that Google Inc. (GOOG) had reached out to the EC and promised to make serious changes to address allegations made by EU antitrust regulators.

I. EU Receives Google's Last Ditch Pitch

Mr. Todd told Reuters in a statement:

The Commission received a proposal from Google and is assessing it.

Google's spokesperson, Al Verney added:

Our proposal to the European Commission addresses their four areas of concern. We continue to work with the Commission to settle this case.

For Google -- who makes the world's most use mobile operating system, search, and internet advertising platforms -- it's been a bewildering ride with European antitrust regulators.  The company has been probed and threatened by the EU for over three years now.
Google fortified
Google has been warding off antitrust accusations from Microsoft, who runs the smaller rival "bing" search service. [Image Source: Fast Company]

The company can largely thank Microsoft Corp. (MSFT) for its EU antitrust woes.  Microsoft has led two key coalitions -- The FairSearch Coalition, whose members also include Expedia Inc. (EXPE) and TripAdvisor Inc. (TRIP), and ICOMP, whose members also include Foundem, Hot-map, Streetmap, and NexTag -- both of which filed complaints about Google, claiming that Google boosts the ranks of its own services when consumers use its search engine.

While this might sound like smart business, Microsoft alleges it's illegal, and it could be right due to Google's dominant position in the search market and the way EU antitrust laws are structured.

Also, Google is accused of "scraping" or gathering results from its competitors’ services using automated scripts to improve the quality of its own results.  Google does not deny doing some scraping; pointing out that Microsoft does the same.  However, given that scraping is a gray area in current antitrust laws, it is possible that Google could be viewed as committing antitrust abuses when it scrapes smaller competitors.

web scraping
Google has also been accused of abusive scraping [Image Source: Google Images/unknown]

Part of the problem is that in the EU Google has traditionally held a much larger piece of the market.  In the EU Google has held as much as 86 percent of the search market; currently it has around an 80 percent market share, according to Reuters.  This is much higher than in the U.S., where its market share is currently around 67 percent, according to market research firm Comscore.

II. More Antitrust Woes Loom for Google

But whether or not Google has abused its dominant position to further its own services like Gmail, Google Docs, Google Flights, and Google Shopping, it's hard not to feel a bit of sympathy for the chaotic way in which antitrust punishments for Google have been handled in the EU.

After being given a "last chance to settle" in May 2012, Google in Feb. 2013 released a full response, which promised big changes as to how it was scraping and ranking search results.  The EC initially accepted that proposal.  But after Microsoft and others claimed that the punishments weren't severe enough, the EC went back on its approval of the Google settlement and demanded more flesh from Google.

EU books antitrust
 The EU "changed its mind" about Google's settlement offer. [Image Source: nrw.nl]

The EC is a pretty fearsome regulator.  It has nailed Microsoft Corp. (MSFTwith multiple fines totaling around $2.8B USD over Windows antitrust abuses, plus pounded Intel with a $1.45B USD fine for allegations of CPU price fixing.  Its policies have been so aggressive that Apple, Inc. (AAPL) opted to settle in the EU over e-book price fixing accusations, while fighting similar accusations in the U.S.

Google is clearly prepared for the worst.  It has set aside $500M USD to pay for potential antitrust fines in the EU.

To make matters worse for Google, the U.S. debate over Google's search engine tactics has yet again resurfaced.  After probing Google, the U.S. Federal Trade Commission (FTC) agreed to a proposal where Google promised to make minor changes and would not face any fines.  The FTC even defended that decision against criticism by Microsoft and others who felt that the punishments were too light.  But recently the FTC has been rumored to be cooking up a fresh probe examining a new angle -- looking at whether Google's acquisition DoubleClick engaged in anticompetitive tactics in the search market.
Google Android
Google is also accused of using abusive tactics to promote its free Android operating system, which accounts for four out of every five smartphones and two out of every three tablets sold.

Google also faces allegation of abuse in the U.S. and EU of so-called "standards essential patents" (SEPs), which are supposed to be licensed under the "fair, reasonable, and non-discriminatory" (FRAND) rules.  Last, but not least, Google also faces a privacy probe in the EU, in which EC regulators have demanded Google make changes by the end of this month.


Privacy is another major issue Google is being grilled on. [Image Source: Inquistr]

In short, even if Google manages to win over the EU with its settlement proposal and escape fines, it still faces at least two more major topics of antitrust investigation in the EU, U.S., and elsewhere.

Source: Reuters



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If You Cant Beat Em
By Reclaimer77 on 9/13/2013 5:09:21 PM , Rating: 3
Form BS coalitions and lobby the fine-happy EU to hammer your competition for you.

Disgusting.




RE: If You Cant Beat Em
By aurareturn on 9/13/2013 5:15:46 PM , Rating: 3
Oh please. I work in the search industry and Google has been using its own search engines to demote competitors and forcefully promote its own products for far too long.

Google is also stealing information from websites with their new "knowledge graph" search results. For example, it takes weather info from weather.com. This steals visits away from weather.com, a site dependent on ads. Google is doing this to many sites - taking visits away from them and basically stealing their content.

Google is the largest plagiarist in the world.


RE: If You Cant Beat Em
By spaced_ on 9/13/2013 5:42:42 PM , Rating: 1
I hear these accusations alot.

But never seen any proof to back it up. Can't find any information to suggest their weather data is 'stolen' at all.


RE: If You Cant Beat Em
By spaced_ on 9/13/2013 5:51:21 PM , Rating: 2
Also, it makes no sense for Google to 'steal' results of something as comprehensive and quick to change as weather data. That'd be ridiculously inefficient and prone to error to crawl a weather site when there's an abundance of weather data providers out there with direct access to data or APIs.

And it seems I'm right: http://www.google.com/intl/en/help/features_list.h...

Unless ofcourse - it's a big conspiracy. Of which I can't find any supporting information, even on Bing.


RE: If You Cant Beat Em
By ven1ger on 9/13/2013 9:19:43 PM , Rating: 3
The 'steal'-ing of weather data is just like the news stuff that news sites are probably complaining about. Just that Google is linking and displaying a snippet of information that most users only peruse, and to get more information they have to click on the link to go to the website. What the complaint seems to be is that most users don't bother going to the news/weather site to generate adclicks. Of course, they could always not allow Google to link to their pages but then of course, we don't hear that part because those sites fear that the clicks they do get from Google, will go to other sites. They don't mind that Google advertises for them a little but they also want the viewers to go to their websites to get the ad revenue, just plain greed.


RE: If You Cant Beat Em
By spaced_ on 9/13/2013 10:21:06 PM , Rating: 2
Given that all evidence points to the fact Google uses a 3rd party weather service to gather their data, which I'm fairly sure they pay for, I'm not sure how they're 'stealing' anything weather related.

The news thing I don't understand, what exactly are they stealing? Google News has been around for a decade and news sites were rejoicing when it first came out. When the Belgian news corporations tried to cut off google entirely a few years back it didn't go so well for them once they realised google was indeed actually doing them a favour.


RE: If You Cant Beat Em
By Reclaimer77 on 9/13/2013 7:48:31 PM , Rating: 1
Is that the kind of pathetic bullshit you "search industry" guys make up and spread around the water cooler? That Google, the search engine, is stealing?

Time to rethink your entire life...


RE: If You Cant Beat Em
By sorry dog on 9/13/2013 9:14:16 PM , Rating: 2
So at what point is it stealing or not?

Maybe you think what is being "scraped" doesn't have much value... and it doesn't. But when it's done millions times a day even if the value of the information is 1/100 of cent it will certainly add up. This is definitely a subject area where the law is 20 years behind the times.


RE: If You Cant Beat Em
By harshbarj on 9/14/2013 4:11:15 PM , Rating: 2
Actually they get their weather data from weather underground as per their features list.

http://www.google.com/intl/en/help/features_list.h...

You would be good to actually check for this stuff before posting nonsense. This took me less than 30 seconds to find, via Google. But I guess that does not make for a good conspiracy.


RE: If You Cant Beat Em
By Alexvrb on 9/13/2013 11:25:21 PM , Rating: 2
Funny, I don't remember too many Googlebots crying when it was MS being hammered over IE (which didn't even have overwhelming dominance by that point).


RE: If You Cant Beat Em
By Reclaimer77 on 9/14/2013 8:55:36 AM , Rating: 2
Yes you did. Are you serious? The only people on here that actually supported that nonsense were a handful of Europeans.


RE: If You Cant Beat Em
By Alexvrb on 9/14/2013 6:29:40 PM , Rating: 1
"Form BS coalitions". Gee who are you referring to here? MS is clearly striking back after Google and Opera pushed for another round of fines for MS a while back. But I didn't see the Googlebots decrying Google's very similar role last go around. Many didn't like the EC's actions, but they gave Google and Opera themselves a pass.


RE: If You Cant Beat Em
By Camikazi on 9/14/2013 10:16:40 PM , Rating: 2
You were not reading if you didn't see people complain. I love Google, I use almost every one of their services and yet I was complaining and pointing out at every chance how it was wrong of them to go after MS and add that stupid browser select thing. From the checking I did on forums so was most everyone else, I'm not sure where you were looking.


RE: If You Cant Beat Em
By Bubbacub on 9/15/2013 4:02:38 PM , Rating: 3
handful of europeans?

more like a handful of unelected european beaurocrats sitting in brussels dreaming of ways to gift themselves more money


RE: If You Cant Beat Em
By harshbarj on 9/14/2013 4:16:04 PM , Rating: 2
The difference is that when you buy a computer you have almost no choice in os (mac is the only other true choice, and I'd even debate that). When you buy a computer it has windows pre-installed. Google on the other hand is a choice, the user chooses to use it.

That's not saying I fully agree with the decision, but I do see their point.


RE: If You Cant Beat Em
By Alexvrb on 9/14/2013 6:43:43 PM , Rating: 2
The recent fines I was referring to only involved RETAIL software. OEM wasn't affected. Oh, and you CAN buy or install other operating systems. Heck lots of people use lightweight almost-PCs now, too - such as Android, Chromebook, and iOS devices.

But frankly, that's irrelevant, since I was talking about the EC fining MS for bundling IE , rather than Windows itself. When an OEM preinstalls Windows and IE, that doesn't apply here either - the EC couldn't quite pull that one off. But Retail copies in the EU have a browser poll. Which is silly, because anyone capable of purchasing and installing a retail copy of Windows is capable of downloading a free alternative browser.

Yet, they repeatedly fined MS for bundling their own browser with their own OS, on retail copies of Windows in the EU. On top of this, MS offered to remove IE entirely, and the EC rejected this. They pushed them into offering a "browser poll" that offers competing browsers. I think retail copies of OS X should come with a browser poll too. :/


RE: If You Cant Beat Em
By spaced_ on 9/15/2013 7:05:31 PM , Rating: 2
Yes I never really understood why the EC went after Microsoft on this issue in the first place. As an example, it's not like Apple and Google don't bundle software with their OS's and no one's restricted by Microsoft from installing another browser in Windows. Users have a choice.

It's completely nonsensical technically and logically speaking to me, but legally speaking is a different matter. Read up on the case, in particular some of the case history between the EC and Microsoft and some of the judgements and it'll start making more sense to you. My fear is the precedent it sets in law. There is no reason why the EC can't do exactly the same thing to Apple or Google or any other company in future simply because they have a large market share. Bring on the iOS/Android lawsuits I guess.

There were a few points in the case that were completely justified though. For example, Microsoft provided financial incentives to PC makers to NOT install alternative browsers . This is clearly anti-competitive.

So, was this Google's fault? Did they lobby for this? Not as far as I know. If you can provide some evidence that'd happily sway my opinion.

But this particular case against Google - another quite stupid one afaict - probably wouldn't exist if it weren't for Microsoft's lobbying. Given all of Microsoft's anti-competitive practices of the past 20+ years, do you really think they're doing it for any other reason than their own bottom line and to gain leverage in the market? Lobbying governmental entities can be far more powerful in the tech industry than innovating, or competing fairly. Particularly when a large majority of the legal industry don't understand what a computer is and you have to compare it to something like a car.


RE: If You Cant Beat Em
By Kiffberet on 9/16/2013 7:47:47 AM , Rating: 2
What you're missing, is that Google are the dominant search engine in the EU. 80% of people use it, and with dominance in a market, comes a whole set of rules, which don't apply to other competitors.

"Users have a choice".

That school of thought doesn't apply, because you might love Google, so why change. Meanwhile, Google sells/shows you things that Goolge wants you to see. It may be all fine and dandy and you never complain, because you don't know that the service you searched for is a Google service. All other services are way down the search list or don't appear, because Google engineers the results to it's advantage.

The law takes a dim view of monopolies or market dominance, and for good reason.


RE: If You Cant Beat Em
By BRB29 on 9/16/2013 8:17:08 AM , Rating: 2
who cares?

Google is not harming the consumers. If they offer me the most refined products for the best bang-per-buck, then I don't care if everything comes from them. This doesn't mean that google is using its marketshare to force consumers. It means that their competitors are not competitive. Last I checked, google was the underdog starting out.

IKEA is knocking many businesses down everywhere they build a store. Does that mean they should go down in flames with lawsuits? No! they gave me decent quality products with smart designs and VERY AFFORDABLE.

What the EU is doing is forcing competitive companies to either help their rivals or slow down. This will end up like Intel where they will stall R&D just because their competitors are nowhere close. It saves them money and keep the lawsuits away.

What's next? Walmart should put Kmart ads in their store windows? It's not fair to Kmart that Walmart is dominating the retail business.


RE: If You Cant Beat Em
By Kiffberet on 9/18/2013 8:16:52 AM , Rating: 2

quote:
who cares?


The EU lawmakers care! And they make the rules.

If you don't like them, you have to change them, or go do business in another part of the world.


RE: If You Cant Beat Em
By spaced_ on 9/22/2013 2:08:42 PM , Rating: 2
Yeah this was actually what I was hinting on. It makes no sense to me why you should punish a company for being too successful. If they have abused their position in the market big penalties should be warranted.

However it appears in EU law you will be penalised if you simply have a dominant position in the market. Abuse or no. It seems you are obliged to advertise your competitors products for free as part of your own products as a penalty.

I agree 110% if google skews results in search for their own products they should be penalised but I have seen no real evidence of that and nothing that technically other companies such as Microsoft and Apple do themselves in the same manner.

Other countries or regions penalise companies for anti-competitive behaviour. EU law is different. Companies are also penalised if they become too successful.


RE: If You Cant Beat Em
By ae00711 on 9/14/13, Rating: 0
RE: If You Cant Beat Em
By Reclaimer77 on 9/14/2013 8:50:39 PM , Rating: 2
America researched, financed, and developed the Internet too. Remember that next time you hate on us "yanks".


RE: If You Cant Beat Em
By retrospooty on 9/15/2013 9:22:02 AM , Rating: 2
Not to mention almost all the tech in his life from the computer he typed that post on (whether desktop, laptop, tablet, or phone it all came from the USA), the tech behind the the electricity that powered it, to the tech behind the car he drives - all USA.


RE: If You Cant Beat Em
By Camikazi on 9/14/2013 10:19:18 PM , Rating: 3
Give it time and your country will be one of the next ones outed for spying, remember US was first, Germany, UK and others were outed right after for doing the same. Here is one very good thing to remember, knowledge is power, and governments know that they need to control the knowledge in order to keep the power.


RE: If You Cant Beat Em
By Kiffberet on 9/16/2013 7:50:40 AM , Rating: 2
Except when it comes to Apple.

All the yanks on this website hate Apple.


RE: If You Cant Beat Em
By tanjali on 9/16/2013 4:33:35 PM , Rating: 2
Why are you so pro Corporate?!


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