Google Offers Deals to Europe After Record Antitrust Penalty

Google declared deals on Wednesday to European regulators over its online shopping service, signaling a new eagerness by the Silicon Valley Company to nod to narrowing pressures from governments around the world.
The fix came after Google was hit by a record antitrust fine of 2.4 billion euros, or $2.8 billion, over the summer for illegally promoting its own services over those of its peers. The fine, in one of the company’s most essential markets, highlights the risks experiencing Google as it looks to secure its dominant position in online search in Europe and other components of the world.
Its decision to finally give competitors a better chance of bringing business in the online shopping sector could also set a precedent, promoting the specter of Google being forced to open up more of its search tool to peers.
Google said the changes would be introduced new on Thursday morning, meeting a time limit to open up its shopping platform to a greater meeting or potentially face further penalties from the European Commission, the European Union’s executive arm. As a result, about a dozen shopping sites from companies besides Google could become more visible and usable.
“We’re giving comparison shopping services the same convenience to show shopping ads from merchants on Google’s search results pages as we provide to Google Shopping,” Al Verney, an agent for Google in Brussels, said.
The penalty against Google in June was among the most combative moves against an American technology company taken anywhere in the world. It instantly confirmed Europe’s role as the Western world’s hardest regulator of digital services. But it has also introduced criticism of Brussels, which has been accused of illegally targeting United States businesses, claims European officials deny.
Still, technology has been a target of marge the vestager, the European Union’s meeting commissioner. Along with other investigations into Google, the commission has also opened questions into tax avoidance, data privacy and misuse of market position, touching American household names like Amazon, Apple and Facebook.
In the case of Google, peers had long complained that the company gave itself an illegal advantage by automatically putting some of its services at the top of so-called specialized search results. Such search products, like restaurant and business reviews, are more and more lucrative.
Under the plan granted Wednesday, Google will make a stand-alone unit for its shopping service. That unit will remain the component of its overall business, but will operate solely and will be subject to regular monitoring by the European Commission. Peer price comparison services, like Germany’s unique and a Dutch comparison site called Vergelijk.nl, would earn money from merchants whose products, from refrigerators to electronic devices, they are advertising. But they would also pay Google to take up those spaces.
Clients across the 28 members of the European Union, as well as Iceland, Liechtenstein, Norway and Switzerland, will be able to look those price comparison sites taking up the spots at the top of a search page where only Google Shopping had formerly appeared.
“Google Shopping will clash on equal terms and will operate as if it were a separate business, engaging in the sell-off in the same way as everyone else,” said Mr. Verney.
The commission has said that Google met its time limit to offer concessions, but has not commented on whether the moves would really bolster competition. Penalties for failing to meet the Thursday time limit could have been as high as 5 percent of the average daily overall revenue of Alphabet, Google’s parent company. Google presented its plans to the commission at the end of August but did not create them public until Wednesday.
Google would like the quote it’s implementing this week to handle narrowly to price comparison shopping services. But it faces complaints from peers in other sectors as well, and they may see an event for prying open Google’s terrific search platform.
Google already is experiencing two separate cases in Europe similar to Android, its software for mobile gadgets, and to some of its advertising products. The company denies the allegation.
But even as Europe has to drive ahead with a series of antitrust charges against Google, the company has not experienced the same scrutiny from regulators at the house, giving cover to United States lawmakers and activist accusing Europe of unfairly focusing American companies.
Still, Silicon Valley tech giants are experiencing shifting political winds at the house, too.
American lawmakers increasingly concerned about the spreading power of technology behemoths and, in particular, the role they may have played in the 2016 election. This shift has opened Google to attacks from both sides of the political spectrum on a wide range of problems, ranging from antitrust to privacy and public confession.
The risk of a regulatory strike is a significant one experiencing the company. It maintains an assertive position in online search, creating the advertisements that run alongside its search results an indispensable component of marketing on the internet.
Any decision to separate classical web search from other search-related functions, such as shopping for products, looking for travel bookings or searching restaurant reviews, could reverse an effective evolution of the company’s moneymaker.

 

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