Google has offered to settle an antitrust investigation filed by the European Commission. Back in May, the commission accused Google of “abusing”¯ its dominant position in the search engine market to give its own products — Google Maps, Google Images –an unfair advantage over that of its competitors. Google was told that it must figure out solutions in four areas in a matter of weeks or face a long and costly antitrust suit that could result in a fine of up to 10 percent of its annual global revenue, about $37.9 billion last year.
Via a letter to European Union Competition Commissioner Joaquin Almunia, Google Chairman Eric Schmidt has outlined how Google proposes to make changes. The EC did not reveal the contents of the letter.
Google’s search engines powers over 90 percent of searches in Europe, far greater than in the US.
In addition to accusing Google of favoring its own products, the commission charged that Google copies content (such as user reviews) from competing search services and uses it in its searches; competitors are hurt by the agreements between Google and websites on which it delivers search advertisements; competitors are at a disadvantage due to the restrictions that Google places on the “portability”¯ of online search advertising from its own AdSense platform to the platforms of others.
CNET points out that if the commission allows Google to settle, Google is in effect admitting its guilt, while still avoiding an actual “guilty” verdict. Antitrust experts cited by the New York Times also note that, at this stage, Google “would be extremely wary of giving away too much” due to what such would mean for business beyond Europe, “where regulators could take what Google offers as a starting point for their own demands.”
Microsoft, Intel In Antitrust Suits With the EC
The offer to Google to settle from Almunia was a “rare public offer,” says the New York Times, and is indicative of the commission’s wish to accelerate the resolution of antitrust cases especially in the technology market, where “remedies often rapidly lose their relevance.”
Previous antitrust suits against Microsoft and Intel have stretched on for ten years. It was only last week that the EU upheld a 899 million euro, or $1.3 billion, penalty given to Microsoft in 2008. The EU’s General Court, its second highest, has reduced the fine by 4.3 percent to 860 million euros ($1.1 billion). Intel is appealing its 1.1 billion euro penalty this month.
More Antitrust Suits Ahead For Google
Even if Google settles the commission’s suit, it still faces others under Almunia, including one about its Motorola Mobility subsidiary regarding thepossible abuse of patents (complaints brought forward by rivals Microsoft and Apple) and another about Google Android. The US’s Federal Trade Commission and authorities in Argentina, India and South Korea have also initiated antitrust investigations.
Google’s lawyers will have a lot to keep themselves busy with for some time.
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