[Update] – Google has shared a statement on the fine imposed by EU
When you shop online, you want to find the products you’re looking for quickly and easily. And advertisers want to promote those same products. That’s why Google shows shopping ads, connecting our users with thousands of advertisers, large and small, in ways that are useful for both. We believe the European Commission’s online shopping decision underestimates the value of those kinds of fast and easy connections. While some comparison shopping sites naturally want Google to show them more prominently, our data show that people usually prefer links that take them directly to the products they want, not to websites where they have to repeat their searches.
The European Commission has fined Google 2.42 billion euro for breaching EU antitrust rules. The search engine giant was expected to hit with a fine up to 3 billion euro. EU had filed formal antitrust charges on Google last year over claims that it has abused its market dominance as a search engine by giving an illegal advantage to another Google product, its comparison shopping service.
As per the fine, Google must now end the conduct within 90 days or face penalty payments of up to 5% of the average daily worldwide turnover of Alphabet, Google’s parent company. The European Commission has the power to fine Google up to 10% of its total yearly sales. The company has a 90 per cent share of internet searches in Europe, giving it a powerful tool to direct how internet users navigate the web.
“Google’s illegal practices have had a significant impact on competition between Google’s own comparison shopping service and rival services. They allowed Google’s comparison shopping service to make significant gains in traffic at the expense of its rivals and to the detriment of European consumers”, the Commission said in a statement.
Commissioner Margrethe Vestager in charge of competition policy, said,
Google has come up with many innovative products and services that have made a difference to our lives. That’s a good thing. But Google’s strategy for its comparison shopping service wasn’t just about attracting customers by making its product better than those of its rivals. Instead, Google abused its market dominance as a search engine by promoting its own comparison shopping service in its search results, and demoting those of competitors. What Google has done is illegal under EU antitrust rules. It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation.
Google’s general counsel, Kent Walker, said in a statement,
We respectfully disagree with the conclusions announced today. We will review the Commission’s decision in detail as we consider an appeal, and we look forward to continuing to make our case.