It looks like Google and the European Commission may have reached an agreement in the big antitrust battle. As reported yesterday, the Commission’s head of competition, Joaquin Almunia reportedly added to his list of conditions that Google apply any agreed upon changes to mobile search, as well as desktop.
Today, reports are coming out that the two parties have reached an agreement, though details are still hard to come by. At the beginning of the month, Google had submitted a proposal, but talks have continued since. According to the Financial Times, it was Google’s agreement to apply the conditions to mobile that sealed the agreement.
Here are the initial concerns Almunia cited in a statement before Google’s proposal:
First, in its general search results on the web, Google displays links to its own vertical search services. Vertical search services are specialised search engines which focus on specific topics, such as for example restaurants, news or products. Alongside its general search service, Google also operates several vertical search services of this kind in competition with other players.
In its general search results, Google displays links to its own vertical search services differently than it does for links to competitors. We are concerned that this may result in preferential treatment compared to those of competing services, which may be hurt as a consequence.
Our second concern relates to the way Google copies content from competing vertical search services and uses it in its own offerings. Google may be copying original material from the websites of its competitors such as user reviews and using that material on its own sites without their prior authorisation. In this way they are appropriating the benefits of the investments of competitors. We are worried that this could reduce competitors’ incentives to invest in the creation of original content for the benefit of internet users. This practice may impact for instance travel sites or sites providing restaurant guides.
Our third concern relates to agreements between Google and partners on the websites of which Google delivers search advertisements. Search advertisements are advertisements that are displayed alongside search results when a user types a query in a website’s search box. The agreements result in de facto exclusivity requiring them to obtain all or most of their requirements of search advertisements from Google, thus shutting out competing providers of search advertising intermediation services. This potentially impacts advertising services purchased for example by online stores, online magazines or broadcasters.
Our fourth concern relates to restrictions that Google puts to the portability of online search advertising campaigns from its platform AdWords to the platforms of competitors. AdWords is Google’s auction-based advertising platform on which advertisers can bid for the placement of search ads on search result pages provided by Google. We are concerned that Google imposes contractual restrictions on software developers which prevent them from offering tools that allow the seamless transfer of search advertising campaigns across AdWords and other platforms for search advertising.
It’s unknown at this point, just what Google has agreed to exactly to ease these concerns, but from the sound of it, they have been eased.
All Google is saying so far, is the same thing it has been saying all along (via Search Engine Land): “We continue to work cooperatively with the European Commission.”
Reuters is reporting: “European Union anti-trust regulators are likely to accept new concessions offered by Google to settle an investigation into alleged anti-competitive behaviour, a source told Reuters on Tuesday.”
The FairSearch Coalition, made up of Google competitors, was quick to release a statement regarding the reports:
The FairSearch coalition would welcome a rapid, substantive and legally enforceable change to Google’s business practices that steer users to its own products and away from others. Only when these practices end will Google’s ongoing harm to consumers and innovators end. Any binding set of changes to Google’s practices must be paired with strong ongoing monitoring and enforcement mechanisms to ensure that the company does not return to its anti-competitive practices.
The members of FairSearch look forward to engaging with the European Commission and Vice President Joaquín Almunia as interested third parties to provide feedback during these technical discussions. FairSearch’s members also plan to participate in ‘market testing’ of any settlement that may be proposed to ensure that it reflects a greater commitment by Google to end its anti-competitive behavior than has the company’s past rejection of the concerns that Mr. Almunia identified after conducting a thorough 18-month investigation.”
It will be very interesting to see what changes Google is making. It’s somewhat surprising to see that that the company has conceded to these concerns so easily, to avoid a big legal battle and potentially large fines.
Earlier this month, it was reported that Google could face the largest fine ever to be issued to a single company by the U.S. Federal Trade Commision, as the result of a setlement over privacy issues related to “Safari-gate”.
And that fine would still be nothing compared to the one Google had to forfeit over Canadian pharmacy ads to the Department of Justice and various law enforcement agencies.
It will also be interesting to see what ramifications any changes Google makes in Europe have on Google in other countries.