In what feels like a sustained
attack on the search giant, the EU has once again ramped up the pressure on
Google with the European Parliament passing a resolution for the breakup of the
company’s search business which control 90%
of search advertising in the continent.
Google has been embroiled in a
four year antitrust case with the EU over its dominant position in search[1].
The Silicon Valley giant has tried to settle offering a number of compromises
but as things stand, the case is still open. Google hasn’t been the only
company that has fallen foul of the EU’s tougher stance with Microsoft getting
whacked for £613m “for monopolistic practices” last year[2].
Two months ago, the EC reopened its investigation into Google’s lucrative
search advertising operation and was rumoured to targeting Google’s dominant
position in the Smartphone OS space[3]
Bowing to the wave of criticism
levelled at the body by ministers of from two of “big three”, other
commissioners in the EC and Google’s competitors, the EC was forced open the
long running investigation it clearly wants to put to bed. Almunia, clearly not
keen on taking action on Google, refused to put a timeline on what has become a
four year investigation as he said “we work in a
rigorous way, as always, trying to understand the arguments of the complainants
and trying to extract from Google solutions to these solid arguments. We are in
this process.”[4]
The investigation
has instead been passed over to new competition commissioner Margrete Vestager
who seems just as cautious as her predecessor[5] . Stressing caution in her
opening public remarks, Vestager told the European Parliament “"The issues
at stake in our investigations have a big potential impact on many players,
they are multifaceted and complex. I will therefore need some time to decide on
the next steps”[6]. She has
also ignored calls to widen the scope of the investigation by Google’s
competitors as she insisted that she “will focus entirely on competition”[7]
However, Vestager, just a few
weeks into her new role, has had a world of pressure foisted upon her by the
European Parliament after the body put forward a draft proposal for the breakup
of Google’s search business. “The European Parliament doesn't have the power to break up
Google, but the motion could apply political pressure on the European
Commission, which sets the region's legislative agenda. The Commission itself
is investigating Google's competitive practices”[8]
The United States was less than pleased with the
news of the proposal concerned about its’ obvious political nature[9].
However the United States really has nothing to worry about as Vestager seems even
more cautious than her predecessor who was prepared to squeeze concessions or a
fine Google for its’ transgressions[10].
Nontheless, on
the 27th, the proposal passed as a “non binding resolution” by a wide 210 vote
margin
However, for all the bluster
and headlines generated by the European Parliament proposal and subsequent
resolution, it’s hard to see the EC taking Google to court never mind winning
the case. What is more likely to happen is that the EC will try to squeeze more
concessions out of Google and maybe even a hefty fine as the body clearly doesn’t
want to increase political tensions between the EU and the US.
In sum, the EU maybe taking a
tougher stance on the Google front but clearly not too hard a stance breaking
up Google would set a precedent that neither the EC or its’ competition
commissioner is willing to set.
[1]
Ibid
[2]
Ibid
[3] http://www.theguardian.com/technology/2014/sep/08/european-commission-reopens-google-antitrust-investigation-after-political-storm-over-proposed-settlement
[4]
Ibid
[5] https://gigaom.com/2014/09/10/googles-eu-search-antitrust-case-will-definitely-pass-over-to-the-next-competition-chief/
[6] http://www.zdnet.com/incoming-eu-antitrust-chief-google-probe-wont-end-overnight-7000035679/
[7]
Ibid
[8] http://www.cnet.com/uk/news/us-expresses-concern-over-eu-proposal-to-break-up-google/
[9]
Ibid
[10] http://www.theguardian.com/technology/2014/nov/26/does-europe-have-the-power-to-break-up-google
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