The European Commission (EC) has levied a heavy fine amounting to a whopping EUR 2.42 billion on the internet giant Google for anti-trust violations on account of the shopping search services. This is a record breaking fine levied by EU on such a prominent company. The amount of fine was calculated based on Google’s earnings from its comparison shopping service in the 13 EEA (European Economic Area) countries.
EC has, in fact, given a notice period of 90 days or 3 months to Google to make the search results fair, with no preferential treatment being given to its own comparison shopping service and no demotion of rival comparison shopping services. If the company fails to do so, it must be ready to face severe consequences for the damages brought forward by the individuals or any of the involved states that have suffered damage owing to these antitrust violations.
According to EC, a thorough investigation will bring forth the business practices used by Google to exploit other search engines and dominate the search results with its own shopping service called Google Shopping.
Whether you know it or not, the fact is that the success of the comparison shopping websites usually relies on the search engine traffic. These sites majorly depend on an exact representation in the popular search engine results like that of Google to generate more views, and thereby, more and more revenue.
According to the investigation, it was reported that Google has been indulging in the illegal practice of giving preferential treatment to its own comparison shopping service since way back in 2008, thus depriving “millions of European consumers of the full benefits of competition, genuine choice and innovation”.
EC officials have simply regarded this unfair practice of Google as illegal to promote its own shopping site at the cost of its rival’s reputation and business. This antitrust violation brought a huge traffic back to the Google’s own shopping site, which is estimated to be 40 times more in the United Kingdom itself. Contrary to this, rival shopping sites suffered a decrease by more than 80% due to this illegal practice adopted by Google that made the competitor sites lose up to 90% and 80% of their traffic in countries like Germany and France respectively.
Google’s antitrust violation is considered to be the biggest antitrust deed in Europe after the much talked about Microsoft decision in the year 2004. If Google fails to pay the fine of €2.42BN levied by the EU within the time period of 90 days, the world’s number one search engine giant can also face upto 5% more penalties for its own parent company Alphabet’s average daily turnover worldwide. Besides this, EU is also investigating two more antitrust violations that may involve Google’s AdSense and one popular Android OS.
The move by EC reiterates that all businesses, whether online or offline, European or not, need to play fair and not violate the basic principles of business and resort to illegal or anticompetitive practices to in their quest to dominate the markets.