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The European Union's competition watchdog has slapped a record 2.42-billion-euro ($3.57-billion) fine on internet giant Google for breaching antitrust rules with its online shopping service.
Key points:
- Investigators found Google elevates its shopping service to top of search results, while rivals typically appear on page four
- Multi-billion-euro fine the highest ever imposed in Europe for anti-competitive behaviour
- Google considering appeal, but result likely to affect other cases against Google businesses
The body that polices EU competition rules, the European Commission, alleged Google systematically elevates its shopping service — even when other options might have better deals.
The Commission said Google had "abused its market dominance as a search engine by giving an illegal advantage to another Google product".
It gave the California company 90 days to stop or face fines of up to 5 per cent of the average daily worldwide turnover of parent company Alphabet.
EU competition commissioner Margrethe Vestager described the action as "illegal under EU antitrust rules".
"It denied other companies the chance to compete on the merits and to innovate," she said.
"And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation."
Google reviewing decision, considering appeal
Google maintained it was just trying to package its search results in a way that made it easier for consumers to find what they wanted.
It said its data showed people preferred links taking them directly to products they wanted and not to websites where they had to repeat their search.
"When you shop online, you want to find the products you're looking for quickly and easily. And advertisers want to promote those same products," Google senior vice-president Kent Walker said in a statement.
"That's why Google shows shopping ads, connecting our users with thousands of advertisers, large and small, in ways that are useful for both.
"We will review the Commission's decision in detail as we consider an appeal, and we look forward to continuing to make our case."
The fine is the highest ever imposed in Europe for anti-competitive behaviour, exceeding a 1.06-billion-euro ($1.56-billion) penalty on Silicon Valley chip maker Intel in 2009.
But the penalty is likely to leave a bigger dent in Google's pride and reputation than its finances.
Alphabet has more than $120 billion in cash, including about $73 billion in accounts outside of Europe.
'On average, rivals appear on fourth page of results'
The action was prompted by scores of complaints from rivals including US consumer review website Yelp, TripAdvisor, UK price comparison site Foundem, News Corp and lobbying group FairSearch.
Ms Vestager said the Commission's probe, which started several years ago, looked at about 1.7 billion search queries.
Investigators found, on average, even Google Shopping's most highly ranked rivals only appeared on page four of Google search results — with 90 per cent of user-clicks on page one.
"As a result, competitors were much less likely to be clicked on," Ms Vestager said.
More broadly, the probe established Google is dominant in general internet search in all 31 countries of the European economic area, Ms Vestager said.
This will affect other cases the EC might build against the internet giant's various businesses, like Google Images.
She also noted regulators were making "good progress" in its other Google probes into Android and search advertising, and that the "preliminary conclusion" was that they breached EU anti-trust rules.
AP/Reuters
Topics: internet-technology, information-and-communication, information-technology, international-law, european-union, united-states
First posted