Google fined a record 2.4 billion euros in European Union antitrust case

Margrethe Vestager EU

Google fined a record 2.4 billion euros in European Union antitrust case

If it does not, Alphabet faces more fines of up to 5 percent of its average daily revenue worldwide.

"Google abused its market dominance as a search engine by promoting its own comparison shopping service in its search results, and demoting those of competitors", said Commissioner Margrethe Vestager, in charge of competition policy.

Meanwhile, the European Union regulator recently said Google abused its market dominance as a search engine by promoting its own comparison shopping service in its search results and demoting those of competitors.

The European Union struck Google with a fine of up to 2.42 billion Euros (around $2.76 billion) over alleged "illegal practices" in how the company operates with online shopping services.

"It has denied other companies the chance to compete on their merits and to innovate, and most importantly it has denied European consumers the benefits of competition, genuine choice and innovation".

Google's misbehavior in Europe boiled down to its practice of highlighting its own online shopping service above those of its rivals. The Froogle service performed poorly, and Google changed its strategy in 2008, according to the EC, when it was renamed "Google Product Search".

The findings in Europe contrasted sharply with those reached by the U.S. Federal Trade Commission in a similar investigation of Google completed in 2013.

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Google's parent company, Alphabet Inc. late Friday confirming the development said the European Commission's antitrust fine will reduce second-quarter profit by about $2.74 billion.

The action follows a seven-year investigation prompted by scores of complaints from rivals such as U.S. consumer review website Yelp, TripAdvisor, UK price comparison site Foundem, News Corp and lobbying group FairSearch. While some comparison shopping sites naturally want Google to show them more prominently, our data shows that people usually prefer links that take them directly to the products they want, not to websites where they have to repeat their searches... That's why Google shows shopping ads, connecting our users with thousands of advertisers, large and small, in ways that are useful for both.

Given the evidence, we respectfully disagree with the conclusions announced today. "We will review the Commission's decision in detail as we consider an appeal, and we look forward to continuing to make our case".

The fine is the highest ever imposed in Europe for anti-competitive behavior, exceeding a 1.06 billion euros penalty on Silicon Valley chip maker Intel in 2009.

It called for experts that can assess and process methods determining the display and positioning of generic search results and of paid search results such as online search advertising. "Left unchecked, there are few limits to this gatekeeper power".

Other antitrust experts believe the fine levied on Google means European regulators are more likely to rein in other USA technology companies such as Apple, Amazon, Facebook and Netflix as they win over more European consumers at the expense of homegrown companies. "Think of this as a new tax".

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