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IN A LONG line of situations pitting it against Europe, Google will likely face calls by the European Parliament to break up the company.
While it’s one of the most radical suggestions made so far by MEPs to curb Google’s influence, there are a number of issues surrounding this.
What exactly is this about?
The news comes from a draft motion from the European Parliament, which states that the “unbundling [of] search engines from other commercial services” should be considered as a potential solution to curb Google’s dominance.
This would mean that the company would have to split up certain elements of its company like YouTube, Google Maps and Gmail into separate entities, and prevent the combination of these services from benefiting its search engine.
The draft, reported by both the Financial Times and Reuters, doesn’t specify any particular search engine, but it’s clearly aimed at Google, which has a monopoly on the search engine market, and puts pressure on the European Commission to impose new laws or sanctions on the company.
It currently has the backing of the parliament’s two main political blocs, the European People’s Party and the Socialists. The main forces behind it are centre-right and centre-left politicians from Germany as well as German corporations like telecoms and media groups.
What’s the background to this?
Ultimately it boils down to the growing distrust European politicians have of Google -which currently owns more than 90% of the European search engine market.
This year has been particularly confrontational for both sides with a number of cases and incidents occurring.
Alongside investigations over it allegedly favouring its own products and services ahead of rivals, it had the European Court of Justice’s Right to be Forgotten ruling to deal with, it’s also been taken to task over in-app purchases (alongside Apple and other companies), complaints about tax and privacy rights
While it looked like its four-year antitrust case against Google’s was coming to an end, the EC reopened the case following complains about the proposed settlement made in spring. It’s also considering the possibility of opening a new case concerning Android’s dominant position.
Since the European Parliament doesn’t have any formal power to split up a company, it can influence and put pressure on the EC, which handles all EU legislation and ultimately has the power to do this.
Does the EC have the power to do this?
It does in theory, but the reality is much more complicated since Google is a worldwide entity, and these rulings will only apply to Europe.
For example, US regulators ended a case in 2013 and found that Google didn’t do anything to manipulate web search results to hurt rivals, although it did get the company to change some of its business practices like scraping reviews and data from other rivals’ sites for its own products.
If it was a case that all governing bodies agreed to the same principle, then you would be able to break it up, but the fact that it would only apply to Europe adds an extra degree of complexity, both in a structural and international format.
In one form, ordering it to break up with be mostly symbolic, while the EC has significant power and can order a company to break up in theory, the reality is going to be more complicated.
It’s very likely that such a move would require new legislation thanks to the complexities involved, and would take months, if not years, to pass through.
What can the EC do?
There are two methods it uses to deal with antitrust cases. The first is to get the company in question to voluntarily change or stop doing something, while the other is to impose certain conditions on a company after an antitrust case.
This usually includes issuing fines to a company, 10% of its turnover which would be easily worth billions of euro in Google’s case, although it does have some past cases to refer to.
The most noticeable example happened in 2009 when the EC reached a voluntary agreement with Microsoft. The case concerned it pushing its browser Internet Explorer, and under the agreement, Microsoft had to give users a choice of web browser when they used Windows.
Fast forward to 2013 and it was fined €561 million for failing to comply with the conditions set, after dropping the feature in a Windows 7 update in February 2011.
The obvious difference between this case and Google’s is that Microsoft only had one product to untie. Unless it specifically mentions certain products (which is unlikely given the general nature of this draft), Google will have to untie a large number of products from its search engine.
So what happens now?
The draft will be finalised this week with a vote expected to take place on Thursday. The incoming competition commissioner, Margrethe Vestager, said that she would listen to both Google and various complainants before deciding on what to do with the antitrust inquiry. In short, it means that Google will have to prepare itself for another long case.
First posted at 11.20am.
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The European parliament is the one that should be broken up.
Excellent comment. Couldnt agree more.
Google produce some top applications and services. If they dominate the market its due to forward thinking and innovation. Google shouldnt be slowed down, the rest need to catch up
Dictatorship comes to mind
Totally agree. Other than feather their own nest I’ve never seen those idiots do anything over the past 30 years.
Maybe its because its headquarters is in Dublin instead of Paris or Brussels.
Well they can’t get at our corporation tax now, especially in view of the other news this morning, this is plan B
That’s exactly why the EU is trying to rock the Google boat Thomas..The Germans and French want a piece Dublin’s Google success..They can’t let the Paddies have success..
Overstepping the mark again. Antitrust legislation is supposed to protect us from entity’s abusing a position of dominance.
somehow it now seems that no abuse is necessary, if a company gets big enough, the EU wants rid – even if it’s doing nothing wrong.
It’s the ultimate penalty for success.
they did the same with Microsoft In the US back in the day , they only left them alone when Gates started giving all his money away. And somehow its ok to have state run monopolies like Irish Water foisted on us.
The same happened to standard oil.
Which ironically made J.D. Rockefeller richer and more influential and powerful than he was with just the one oil company.
#PoliticianLogic
They reckon when he died in today’s money he’d be worth about $600 billion. Some going.
I’m not going back to using Ask Jeeves!
I would rather see the pseudo dictatorship known as the European Parliament, to be broken up
Knowledge is power even if it comes via Google. The EUSSR is afraid of a population armed with the knowledge of it’s attempts to control them.
Google is more useful then the EU parliament. Scrap the parliament instead.
any chance of unbundling the EU?
Irish Water is also dominating the Irish Market should they not be broken up too?
What utter horsesh!t.
Google have a position of major dominance for one reason – the superiority of the user experience that they offer.
By forcing them to divest certain elements of their business, that user experience will be diminished. Thereby creating a market for new products and services which people currently don’t need or want.
Google doesn’t stifle innovation, it encourages it. You wanna be the best – come up with an idea better than Google have.
iOS?
Isn’t a search engine, doesn’t provide streamed content like YouTube, doesn’t offer a social media experience, doesn’t sell ad space.
Additionally, iOS is a handset and tablet operating system, which is only a minor part of Apple’s operation and is being whooped in the market by Android’s OS in terms of devices running it.
Your last paragraph was about innovation, Sean.
iOS is an innovation, it predates Android and will be shown in time to be the better platform.
Liking DuckDuckGo as a search engine. The issue of privacy and what personal data Google collects and distributes about its users should be a huge concern for every democracy.
Actually Paul,
iOS was released first however, Android as a company (which predated Google’s purchase of it) was established 4 years before the first iPhone release.
So yeah they beat Android to market, that doesn’t mean that they had all of the ideas first. Additionally, touchscreen phones had been around long before iOS, so I’m struggling to figure out exactly what you mean by iOS “is an innovation”.
Your opinion on iOS notwithstanding, Android is by a huge margin the most popular smartphone operating system in the world and has been for years. iOS may be seen to be the better platform (by whatever nebulous criteria you wanna cherry pick to support that opinion). But there are two cold, hard facts about that fight:
1. iOS depends on Apple hardware, which is significantly more expensive than almost every other manufacturer.
2. Android already have the largest share of the market of any OS developer and it’s growing.
duckduckgo is pi** poor and although I use it from time to time google is better when you don’t have all day to comb the results.
Mort,
If you’re using a search engine in the first place it’s because you don’t know what you are actually looking for. It’s still early days for DuckDuckGo – but if you can’t see the advantage of not being tracked as you search, then perhaps you’re ok with sharing everything about yourself with the world.
Yes Google offer YOU better search results – and that is because Google know what YOU are looking for before YOU do.
Add in all your Android history and you can see why the EU is concerned.
Paul,
Not knowing what you’re looking for is only one of several different reasons for using a search engine like Google.
Equally, some people don’t like the way DDG returns results (I would agree with them personally). Google on the other hand has a very comprehensive system using Boolean Operators etc. through the advanced search.
Some people don’t care about their search history being stored, it doesn’t really bother me to be honest, but I agree that can be a concern. Still the numbers don’t lie, Android (and Google) are the preferred options for Smartphones, tablets and searching.
Android history? What’s that?
I use specialised search engines to find scientific papers that I wish to read Paul,are you suggesting that I don’t know what I’m looking for? Perhaps I should use Divine Intervention instead?
lads chumhum is the future. take my word for it
Google is great & shouldnt stand for this its done so much for the people, in todays world theres no need to be stupid anymore, dont know some thing google it.
We should support google the eu has done good, but by the mainly destortying markets/ changeing policyes then years later bringing them back to improve that counrty.
kraft foods own every thing now, why dont the eu break up them.
We should get out of the EU and take back control of our own country
Couldnt agree more. Attacking google? Google don’t force themselves on anybody. They simply have the best products so people use them. Its a crime to be successful now? Have a look at this please https://secure.avaaz.org/en/petition/Dail_Eireann_Stop_paying_all_debts_which_are_a_result_of_bailing_out_private_banks/
“Alongside investigations over it allegedly favouring its own products and services ahead of rivals…”
Heaven forbid.
Is that not business?
The EU will sue any successful american company it can because money!
Someone isn’t getting a piece of the pie, The E.U ,,legal version of Mafia
The European Parliament has a serious problem with big business.
Google might have 90% of the search engine market now but it could easily change in the future organically. They should not interfere IMO.
The search engines currently should include specific country, continent, meaning of word, search or a tuition on how to search without getting over 1million found searches every time!
?????????
have your say