Google faces a day of reckoning with the European Commission, after a coalition of competitors roundly rejected its proposals to change the presentation of search results to Europeans in the face of monopoly complaints.
Joaquin Almunia, the EC’s antitrust commissioner, must now decide whether to accept Google’s suggestions, seek new concessions, or instead move to a “statement of objections” leading to legal enforcement on the search giant. If Google didn’t comply, it could be fined up to 10% of the company’s global revenues.
Almunia hinted a month ago that Google would have to revise its offering, following initial angry reaction from rivals. Last Thursday he said in a speech in Madrid that “there is a tougher way to handle it” if negotiations fall short.
He also hinted that if a deal is feasible, “it will probably be reached by the end of the year.” It would also be the first time anywhere in the world that Google has been obliged to change its search presentation over monopoly concerns. A deal would be binding for at least five years.
But competitors who have studied the proposals in depth over the past two months are scathing. “It would be better to do nothing than to accept Google’s proposals,” said Thomas Vinje of FairSearch, a group of 17 companies including Microsoft and TripAdvisor. “The proposals would make things worse rather than better.”
Instead, they say, the past two months have shown that Google’s proposed labelling – which would distinguish its own offerings from rivals’ content – actually favours the US company.
“This will be a counterproductive measure, it will institutionalise the search bias,” said Moritz von Merveldt, head of antitrust matters at German media company ProSiebenSat.1 Group. “Users often will be directed away from competitors’ offers.”
Merveldt said that a test suggested his company would lose 20% of its web traffic, and concomitant advertising, if Google’s labelling were implemented on weather searches. Others have similar concerns, and say that Google should have to surmount the same hurdles as they do in competition for search placing.
“As a minimum requirement, Google must hold all services, including its own, to exactly the same standards, using exactly the same crawling, indexing, ranking, display and penalty algorithms,” said Helmut Heinen, the president of the federation of German newspaper publishers BDZV.
The EC has been investigating Google since 2010, following accusations made by members of Fairsearch that it is abusing its dominant market position in Europe – where it has about 90% of the desktop search market – to promote other properties it owns, such as YouTube, Maps, Google Shopping and others.
UK vertical search firm Foundem complained to the EC in 2010 that Google was unfairly demoting its results in search listings, while boosting its own products for the same search. In January, it emerged that it issuing Google for lost revenues over “anti-competitive conduct”.
In 2012, Almunia published a list of objections to Google’s existing search layout and other behaviour, including “scraping” content from third-party sites for reuse in search results. Almunia published Google’s set of remedies at the end of April 2013, and then sent them for “market testing” with complainants to see if they would agree to it.
But their reaction was almost immediate. Vimte complained that Google’s suggestions “would simply allow [it] to continue prominently to display its own related services in the prime real estate of the page.” Competing sites’ links would appear “in a manner that it designed to dissuade users from clicking on them.”
At the heart of the row is the question of whether Google artificially pushes results for its own properties, such as Google Shopping or Maps, higher up the results than they should “naturally” appear. The company chairman Eric Schmidt argued in the US in 2011 that Google’s incorporation of its maps and video results was part of “universal search” and that the elements could not be considered separately – though Foundem was disparaging of the claim. Yet an investigation by the US Federal Trade Commission into Google’s position in the US market concluded in January that its search presentation did not harm consumer choice.
Google referred to a statement the company posted on its blog on Monday by Google executive Kent Walker. “Our proposals are meaningful and comprehensive, providing additional choice and information while also leaving room for future innovation,” he wrote. “We think we did a pretty good job.”
source: Guardian UK