On Google antitrust case: “Let’s face it, some companies want to hurt Google and it goes as simple as that”

Portraits of Margrethe Vestager, Member of the EC in charge of Competition (EC Audiovisual Services, 11/12/2014)

After 5 long lingering years a bit of light will be cast on Google’s antitrust case in Europe. Former Commissioner Joaquin Almunia for Competition failed to resolve the matter successfully during his term, going back and forth numerous times. Like a modern Pontius Pilate who “washed his hands”, the Spanish politician, who launched the Google investigation back in 2009, left this “hot potato” sitting on his desk for the new Commissioner, Mrs Margrethe Vestager, to “peel”. According to sources, the next days will finally flag some evolution in the Google drama in Europe.

The Sting has been following the case very closely, with numerous investigative analysis during Mr Almunia’s times. The EU’s antitrust case against Google refers to the dominant position of the search engine, which is estimated to some 90% of the European search engine market. Competitors like Microsoft are wildly envious of the European citizen’s preference to this American search engine and have been lobby spending considerable money during those 5 years to get Google “punished”. Further, retailers that do not see their thumbnails prominently positioned in Google shop, travel agencies like trip advisor, and even huge publishers like Axel Springer have been seeking for a long time the “punishment” of Google by the European Commission. This punishment would amount to a maximum of 10% of the giant’s most recent turnover spreadsheet or some €6 billion.

Sources maintain that 6 billion is an astronomical number, even for the huge flock of lawyers that the European Commission employs. The record fine imposed ever in a company by DG Comp has been €1,1 billion and was addressed to Intel for benefiting from its leading position as chip manufacturer. The main American “rival” of Google, Microsoft, have also seen their bank account empty by some €2 billion during the last decade, over claims like browser “monopolisation”. The Google case is currently missing from the trophy collection of DG Comp.

All against Google

The Danish Commissioner who is now in power for less than 6 months, last week from a conference in Copenhagen declared that some companies make an “illegal use” of their “position of dominance in a certain market to make life difficult for rivals or keep them at bay.”…“In this as in any other investigation, we are indifferent to where the companies involved happen to be headquartered” because “the same rules apply to all,” she stressed.

Further, TripAdvisor’s CEO, obviously disappointed by how the competition body at the other side of the Atlantic (FTC)  spared the “life” of Google on a similar case, said openly to New York Times: “Google’s anticompetitive behavior and restricting search does not benefit consumers and it’s disappointing that with so many examples the F.T.C. closed the investigation,”…“We are hopeful the European Commission will come to a different conclusion.” All the Google rivals pretty much empathise with the CEO of the digital travel agency service.

The big issue

The big issue though is not the €6 billion or the 1€ billion compromise to end up with. No, the big issue is the settlements or changes that Google has promised to Mr Almunia to make, in order to serve the complainants worries. This is something that the press has not cast enough light on. Many have said that the changes Google proposes to make are minor, others say that they are not adequate. But not substantial reportage has been created on the scenarios Google proposes. Most importantly no clear determination has been shown by the Commission to work on those “settlements”, push the American company to give more and more freedom to competition.

Let’s face it, some companies want to hurt Google and it goes as simple as that. They dream of a knife in the belly of the beast, a couple of billion euros paid by the grumpy shareholders, and most of all they dream of the cost, time and pain that Google will take to reshape their interface and even customise it uniquely for the European market. This would please the competition, as it would slow down the leading search engine, hoping that Bing or Cling would increase market share. This is mainly the gist of it.

A balanced approach

Mrs Vestager and DG Comp is anticipated now to resume the settlements procedure with Google, hopefully in a more productive way than her predecessor. Sending billions of euros fines is not the solution to any problem. Instead, let’s simply make Google Europe a more “tolerant” interface with less Google branding.

In any case, the Commission needs to keep away from the Sirens that want their enemy “hanged”, and find the right balanced scheme to the Google interface. Balanced for the consumer who wants plurality and balanced for the market who needs to remain sustainable and profitable. Mrs Vestager and her team have already shown some positive signs that they are able to deliver. The Sting in the meantime will follow the matter closely.