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The EU Commission’s investigation into claims that Google abused its dominant market position by promoting its own shopping comparison service at the top of search results (while demoting rivals) has dragged on since late 2010. Now, European regulators have finally ruled against the company and hit it with a record fine of 2.42 billion Euros, or $2.72 billion.
In a statement, the EU Commission says Google breached EU antitrust rules by giving an illegal advantage to another one of its products – the shopping comparison service. It warns that the company must cease this conduct within 90 days or face additional penalty payments of up to 5% of Alphabet's average daily worldwide turnover. To give you some idea of how much that would be, the Google parent company's total revenue for 2016 was almost $90 billion.
The EU found that:
- Google has systematically given prominent placement to its own comparison shopping service: when a consumer enters a query into the Google search engine in relation to which Google’s comparison shopping service wants to show results, these are displayed at or near the top of the search results.
- Google has demoted rival comparison shopping services in its search results: rival comparison shopping services appear in Google’s search results on the basis of Google’s generic search algorithms. Google has included a number of criteria in these algorithms, as a result of which rival comparison shopping services are demoted. Evidence shows that even the most highly ranked rival service appears on average only on page four of Google’s search results, and others appear even further down. Google’s own comparison shopping service is not subject to Google’s generic search algorithms, including such demotions.
When formally responding to the charges last November, Google said: "There is simply no meaningful correlation between the evolution of our search services and the performance of price comparison sites.”
The fine is almost double that of the largest ever previous payout in an EU antitrust case, surpassing the $1.45 billion imposed on Intel in 2009 for its anticompetitive practices. But Google’s penalty it isn’t as high as the $3.4 billion punishment some predicted it would receive last year.
Google may have received the biggest fine, but it isn’t the only US tech giant to face the wrath of the EU Commission. In addition to Intel, other targets include Microsoft, Qualcomm, Apple, Amazon, and Facebook.
The EC will be holding a press conference soon.