Google Again Rejects EU Antitrust Charges Over Online Shopping Service

The European Commission's concerns are not based on market realities, the company argues.

Google

Google this week once again formally rejected charges in the European Union that the manner in which it displays results on Google Shopping harms rival comparison-shopping sites.

In a blog post, Kent Walker, Google's senior vice president and general counsel, defended the company's approach to online shopping searches and said that the changes demanded by the European Commission would limit the usefulness of Google's search results.

Walker faulted the European Commission for basing its antitrust complaint against Google on a theory that is at odds with the manner in which people shop online and the highly competitive nature of the online shopping service market.
"Forcing us to direct more clicks to price comparison aggregators would just subsidize sites that have become less useful for consumers," he warned.

The EU's investigation of Google's online shopping service stems from complaints by price comparison aggregators who have claimed that traffic to their sites have been hurt by Google's practice of highlighting paid ads in its online shopping search results.

The rival sites have claimed that in doing so Google often fails to list the most relevant links on top of its search results. So, a consumer searching for a product on Google will likely first see products from companies that paid to advertise on Google even if more relevant products are listed on other sites.

The companies that have complained against Google have argued that this practice has diverted traffic from their sites while depriving consumers of broader choice.

The EC first filed a formal Statement of Objections listing its charges against Google over the issue in April 2015. As it did this week, Google rejected that first set of complaints as well, in August 2015.

The European Commission followed up again with a revised set of complaints over the same issue this summer.

According to Walker, all Google is doing is making it easier for consumers to connect directly to merchants selling the products they are looking for. In recent years, Google has added product pictures, prices and links in shopping search results to make them more useful and actionable for users, he said. "Showing more useful ads benefits us, our advertisers, and most of all, you, our users."

Walker noted what he described as the "robustly competitive" nature of the online shopping service market using Amazon, Facebook and other online services as examples. There are literally hundreds of product comparison sites available to consumers, and over the past several years some have exited the business while others have entered the space, he said.

The European Commission's antitrust complaint does not take into account the highly competitive nature of the marketplace nor the manner in which consumers actually search for products and shop online, he added.

As an example, Walker said, one-third of online shoppers in Germany begin their search on Amazon compared with just 14.3 percent on Google and an even smaller 6.7 percent on price comparison sites. In the United States, more than half (55 percent) of consumers begin their online product search on Amazon, compared with 28 percent who do so on search engines and 16 percent who go directly to retail sites.

The small number of companies that have filed antitrust charges against Google do not represent the reality of the online shopping services space, Walker maintained.

Google faces potentially billions of dollars in fines and could be forced to change some of its practices in the EU if the European Commission decides the company has infringed EU antitrust laws.

The dispute involving Google's online shopping service in the EU is one of several that the company is working its way through currently. EU authorities are also looking into whether Google's Android software bundling practices and its Adwords advertising service are operating in compliance with European fair trade laws.

Jaikumar Vijayan

Jaikumar Vijayan

Vijayan is an award-winning independent journalist and tech content creation specialist covering data security and privacy, business intelligence, big data and data analytics.