EU Regulators Taking “Very Careful” Look At Google
Just after Google announced the widely anticipated acquisition of travel data and software company ITA I was told by Google PR that European authorities weren’t going to get a chance to approve or disapprove the deal because ITA’s EU revenues were “too small” to qualify for scrutiny.
Yet there are a range of actions and claims against Google still pending in various legal and regulatory venues in Europe. Most recently, for example, French regulators found that Google had “abused its position” in shutting down a French company’s AdWords account.
This finding is perhaps representative of a European trend toward more “toughness” against Google and its business practices.
In that case Google actually thought it was complying with French law in turning off the advertiser’s account because the product the company was selling contributed to an illegal practice in France, avoiding cameras that try to catch speeding cars. Google is going to fight/appeal the ruling.
One could forcefully argue that Google had done nothing wrong and Google’s incorrect interpretation of French law didn’t warrant such an inflammatory statement from French regulators. But European regulators are now “gunning” for Google, it would appear.
They generally seem to believe that “the search giant” or “search juggernaut,” as Google is often now called routinely, is simply too big and too powerful. Because of its market position the company, say regulators, is now worthy of monitoring and scrutiny at every turn.
Europe’s view and experience to some degree are shaped by the prior antitrust battle with Microsoft, in which European regulators proved to be far more successful and punitive than their American counterparts.
An article appearing yesterday in the Wall Street Journal reflects that European antitrust authorities are going to be watching Google “very carefully” for the foreseeable future:
The European Commission, Europe’s highest antitrust authority, is currently looking into “some allegations of anticompetitive conduct in relation to search,” Mr. [Joaquin] Almunia said in his speech in London. Although the work is at an early stage, “I am looking at the allegations very carefully,” given the importance of online search to the marketplace, Mr. Almunia said.
The NY Times cites unnamed “antitrust experts” for the proposition that US regulators will review and then likely approve the ITA acquisition, though perhaps with conditions.
Some time ago Google did its own careful analysis and calculation about ITA and came to a similar conclusion. That confidence allows the company to offer significant “kill fees,” as it did with AdMob reportedly. However there’s been no admission of such a kill fee in this case. Yet I wouldn’t be surprised if there were.
The tone of much of what’s coming out of Europe is suspicion and skepticism toward Google. The Europeans may not get a chance to weigh in on ITA but they’ve signaled that they’re prepared to seize whatever opportunity they can to reign in what they see as an arrogant and too-powerful American corporation.