Google Is Nearing Deal With EU on Search Antitrust Allegations
In an email response to an Oct. 2 inquiry from eWEEK on the matter, Kent Walker, a Google senior vice president and general counsel, said: “This has been a very long and very thorough investigation. Given the feedback the European Commission received on our first proposal, they have insisted on further, significant changes to the way we display search results. While competition online is thriving, we've made the difficult decision to agree to their requirements in the interests of reaching a settlement." In September, Google submitted a fresh batch of concession proposals to the EU, but they failed to address the key concerns of the EU and the complainants in the case, which began in 2010. Those proposals arrived two months after the EU's regulatory arm, the European Commission (EC), had asked for more concession ideas from Google. The EC has been seeking Google's ideas on how it could settle complaints that the company was blocking competitors' results in Web searches in favor of its own results. Google officials are under investigation in Europe regarding its search engine, which holds more than 60 percent of the search market, with Microsoft's Bing being a distant second. Competitors have claimed that Google works its search algorithms to favor its own products and results over those of others, giving it an unfair advantage in search and Web advertising.In an earlier round in April, Google proposed several concessions that were apparently not seen as going far enough. The company had offered to improve how it labels ads in its search engine to make them clearer, and to change and improve how it displays links to competitors' ads in search. Proposed under the deal was a plan for a monthlong "market test" of the arrangement to provide competitors, many of whom are behind the antitrust complaints against Google, some time to offer their input into whether the proposed changes are sufficient. Another change under the April proposals was that Google would allow Websites to keep their content out of Google's specialized search services, while ensuring that any opt-out does not unduly affect the ranking of those Websites in Google's general Web search results. The EU investigation centers on what the agency regards as Google's dominant position in search. Google had also sent an earlier batch of concession ideas to the EC in January, which was the second batch since an initial offering in July 2012, when Google executives sent a list of initial concessions to address the potential antitrust concerns. At that time, Google Chairman Eric Schmidt sent a letter to Almunia that outlined steps the massive Web company would be willing to take to resolve the EU's concerns, including claims that it favors its own search results over those of others. Almunia had given Google officials that opportunity to address that issue and other concerns, including the use of material from other search engines in its results and its dominance in Web advertising, all of which investigators said put competitors at an unfair advantage. Google's legal situation in Europe continues even as a similar antitrust probe in the United States was resolved in Google's favor in January 2013. Instead of a major antitrust prosecution in the United States, Google entered into a voluntary agreement with the Federal Trade Commission to change some of its business practices to resolve the complaints of some competitors about Google's practices. In the FTC case, key competitor Microsoft had led a fight with other technology companies to argue for strong FTC actions against Google to punish it for what they believed were unfair business practices.
A guilty verdict on such charges could mean a fine of up to 10 percent of Google's annual revenue, which based on its 2012 annual results, could amount to about $5 billion.