Antitrust investigators slam Google with $2.7 billion fine

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Google
The E.U. regulators are hitting out at Google.
Photo: Ste Smith/Cult of Mac

Google has been fined 2.4 billion euros ($2.7 billion) by European Union regulators for reportedly skewing its search results in a way that hurts smaller shopping search services.

In addition to the massive fine, Google has been told that if it doesn’t stop its “illegal” suppression of rival price comparison services within 90 days, the European Commission will fine it up to 5 percent of its daily revenue.

“Google’s strategy for its comparison-shopping service wasn’t just about attracting customers by making its product better than those of its rivals,” said Margrethe Vestager, the E.U.’s antitrust chief. “It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services.”

The fine against Google comes at the end of a seven-year E.U. probe into the company, following complaints from both smaller shopping sites and larger companies, including Microsoft.

Google’s price comparison service has been running since 2008. Rival services reportedly appear only on page four of search results, where 95 percent of all users only ever visit the first page of search results.

“As a result of Google’s illegal practices, traffic to Google’s comparison-shopping service increased significantly, whilst rivals have suffered very substantial losses of traffic on a lasting basis,” the EU said, citing figures of a 45 percent increase in traffic for Google’s service.

This is the second major blow against Google in the E.U., following its loss of the “right to be forgotten” court case three years ago.

Issuer of big fines

This isn’t the first time Margrethe Vestager has handed out a giant fine to a Silicon Valley tech giant.

Back in 2016, Apple was fined a massive 13 billion euros ($14.52 billion) bill for unpaid back taxes in the Republic of Ireland. The ruling — which Apple has since continued to battle — ruled that the company was taking advantage of illegal state aid that allowed the company to route profits through Ireland.

In the aftermath, current U.K. Secretary of State for Foreign and Commonwealth Affairs Boris Johnson criticized Vestager for being a, “crop-haired … Left-wing” ideologue “straight out of that Scandi-noir serial Borgen.”

Source: Bloomberg