28th Oct 2016

Google on brink of EU settlement

  • Google is on the verge of settling its differences with the commission on web searches (Photo: Tambako the Jaguar)

Google is on the brink of ending a three-year competition battle with the European Commission, after the EU executive indicated it is ready to accept its latest offer to change the way it runs web searches.

In November 2010, the EU executive launched an investigation into claims that the search engine firm used its 95 percent market share in Europe to distort internet search results by putting links to its own products and services at the top.

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The EU's competition case has also focused on how Google displays content from other websites without permission.

However, speaking with reporters on Wednesday (5 February) the bloc's competition boss, Joaquin Almunia, said that Google's third and final offer, finalised in January following weeks of "intense negotiation" was "far reaching" and could bring about "a level playing field in web searches."

The Spanish commissioner also dismissed suggestions that the EU executive should have taken a tougher line and threatened Google with sanctions.

"The alternative could take many years and many uncertainties and would not necessarily be good for consumers," commented Almunia, although he acknowledged that "if Google's latest offer had not been a good one we would have gone another way."

Under EU competition rules, sanctions could include a potential fine of up to 10 percent of Google’s annual turnover of around €40 billion.

As part of the five-year offer tabled by the firm, services offered by Google would be graphically separated from other search results. Google would also put a label on its webpages to remind consumers that its own products will be given special treatment by web searches.

Meanwhile, Google would make it easier for companies to buy adverts through rival networks by dropping exclusivity requirements which force publishers to take their adverts solely from Google.

However, Google's rivals, led by industry lobby group ICOMP, quickly slammed the new terms as "a massive failure."

In a statement on Wednesday, ICOMP, which is sponsored by Microsoft, called on Almunia to set up an independent review of the offer from Google before making a decision.

“We do not believe Google has any intention of holding themselves to account on these proposals, and given the catastrophic effects on the online ecosystem that a proposal that doesn’t hit the mark will have, we would implore commissioner Almunia to allow a full third party review of their submission as the very least the commission can do in this landmark case,” it said.

"Without a third party review, Almunia risks having the wool pulled over his eyes by Google," the statement added.

Meanwhile, Fairsearch Europe, which includes Nokia among its members, said that the Google plan would "lock in discrimination and raise rivals’ costs instead of solving the problem of Google’s anti-competitive practices."

It complained that the offer would still require rivals to pay Google to guarantee search placement similar to that offered to Google’s own material through an auction mechanism.

For her part, Monique Goyens, director general of European consumer group BEUC accused the commission having "fallen far short of the aim of ensuring fair consumer choice."

Complainants will now give their opinions to the proposals before the commission takes its final decision in the coming months.

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