Digital Marketing

Extra EU Antitrust Legislation for Google (and Fb) for Information Assortment

Google is facing two fronts of closer antitrust control in Europe. Reuters reported that Google is currently facing a comprehensive review of its "collection and use of data." In addition, the European Commission (EC) company's Shopping Compare Engine (CSE) competitors have officially accused Google of its business practices continuing to damage them in violation of the terms of a 2017 antitrust agreement.

Focus on the use of data by Google and Facebook. Reuters said a document "shows that the EU's focus is on [Google’s use of] data related to local search services, online advertising, online ad-targeting services, sign-in services, web browsers, and others." CNN confirmed the investigation independently and said it is also about the data practices of Facebook.

There is already a separate investigation into the local and travel search competition in Europe.

Further investigation than earlier antitrust investigations. Earlier Google antitrust investigations focused on specific market segments or Google practices, including shopping, pre-installation of Android apps, AdSense contracts, and selection of browser search engines. To date, the EU has imposed a fine of more than US $ 9 billion on Google for alleged "abuse of market position" and related antitrust violations. Google has filed an appeal against most of these fines and decisions, although the fines have had little impact on Google's revenue or share price.

In 2017, Google had to make changes to the display of search results for purchases in order to provide "equal treatment" to the European CSEs in the SERP. As a result, Google Shopping was compelled to compete with CSEs for placement in Product Listing Ads, with no dedicated slots for the company itself. Billing also had other regulations and requirements.

Google's shopping material "does not work". European Competition Commissioner Margrethe Vestager recently stated after a first positive assessment that the remedy does not work and does not generate significant traffic to CSEs. One reason for their reversal is continued complaints from CSEs that their companies are not benefiting from Google's remedies and that as margins grow, they actually become "agencies" for their traders.

Reuters reported that 41 CSEs from 21 European countries have now officially complained to EU Competition Commissioner Margrethe Vestager that Google is violating the terms of the previous cartel agreement and that this should now be treated as a "breach of antitrust rules" penalties.

However, Google responded that it does indeed bring more traffic to traders serviced by the CSEs, possibly suggesting they become agencies for their traders.

History of data-related complaints. Google has argued in the past with the EU regarding data retention, but also with regard to the breadth of data collection and use in all products. Google's competitors (eg, Oracle) have also complained that Google can capture and combine data from many of its properties to gain a more holistic view of consumers and their behavior. This offers a potentially unfair competitive advantage.

One of the possible unintended consequences of the GDPR was that Google and Facebook benefit from it, while smaller companies are disadvantaged without their many features and expansive networks. This seems to be at least one reason for the EC's investigation into the data collection practices of Google and Facebook.

Why should we worry. It is not clear at this time how the EU will investigate the data collection practices of Google and Facebook. One scenario would be no change or minor change, another scenario involves additional fines and significant changes in the collection, storage, and use of data for targeting. The companies can also be treated very differently. At the moment, however, it is running as usual.

About the Author

Greg Sterling is an editor for Search Engine Land. He writes about the connections between digital and offline commerce. Previously, he held leadership positions at LSA, The Kelsey Group and TechTV. Follow him on Twitter or find him on LinkedIn.