Google Replies to Antitrust Lawsuit

Michael In the News

Two requested and granted extensions later, Google has finally responded to the European Commission’s (EC) claim that it violated antitrust laws. The EC filed a lawsuit in April after investigating the tech giant for several years under two different commissioners. The EC has also received formal complaints from many companies about Google’s search results page. Google has been largely silent on the issue, but finally filed a formal rebuttal last Thursday.

Google has a Checkered Past in the UK

This case is of special significance in the UK where Google holds a 90% share of all internet searches as opposed to the US where the share is closer to 65%.

Complainants include publishing companies, European tech companies, Microsoft, and Yelp. They all claim that Google’s search results harmed their businesses by placing Google’s own products and services first. After four years of investigation the European Commission seems to agree.

Google went through a similarly worded case in the US. At the conclusion the Federal Trade Commission found that the code used was ‘problematic’ but Google ultimately escaped unscathed.

Google has already lost one battle in Europe. Earlier this year they lost a case that forced them to remove unwanted search results. This has been called the ‘right to be forgotten’ and in its first year Google had a quarter of a million take down requests.

Ironically enough, Google has even been ordered by UK courts to remove results to stories talking about them removing results to stories.

The Long Awaited Rebuttal From Google

Google has been largely silent about the antitrust case in Europe. Only breaking the silence on 2 occasions before Thursday. One was a blog post and the other was an interview with the freshly positioned Matt Brittin. He is the first to hold the title of European President for Google.

When Brittin sat down with Politico in early June he maintained that the lawsuit stemmed from a misunderstanding. He claimed that Google simply didn’t make its policies and goals clear when they moved into the European market. He admitted that the blame for this misunderstanding lies with his company, “We don’t always get it right. As far as Europe is concerned: we get it. We understand that people here are not the same in their attitudes to everything as people in America.”

He went on to say that the competition such as Amazon and Ebay is stiff. He even went so far as to say that there has never been a more competitive time than now for the tech giant. But how much competition do you really have if you hold 90% of the market share?

In the official rebuttal Google claims that Amazon and Ebay are the major players, making Google’s personalized advertising essential to their product. They also claimed that the 20 billion free clicks (in the countries covered by the EC) through their services increased traffic to sites on the order of 227% over the past 10 years.

The response given on Thursday showed that Google is in it for the long haul. And why not? They quite possibly have a lot to lose. The European Commission can administer a fine as large as 10% of Google’s annual revenue. Which equates to almost $7 billion. However, the largest fine ever was against Intel in 2009 for $1.2 billion. The commission could also order them to change their practices in a way that significantly hinders how they currently do business.

The EC can rule as early as the end of this year or take years to decide on a ruling. Plus, after that, Google can appeal in two different courts, dragging the case on for another five to seven years. All the while allowing Google to continue business as usual and not significantly changing their practices.

This is just the beginning. In a separate case, the EC is also investigating Google’s Android- which they made no mention of in Thursday’s rebuttal. In this case, the EC is trying determine if Google adding incentives and sometimes requiring their Android OS and Google apps to be installed on smartphones and tablets was ethical. Other companies like disconnect.me have filed complaints for being removed by the Google Play Store.

Is the European Commission a Bully?

Is google getting picked on by the European Commission? Some think so, especially when you take into account the several other American tech companies that have been or are being investigated by the EC. Companies like Amazon, Apple, Microsoft, and Facebook all have extensive cases being investigated or filed against them at the moment.

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