Record Fine Of $5 Billion Slapped On Google By EU Antitrust Authority

Google has been slapped record fine of 4.34 billion euro ($5 billion) by EU antitrust regulators for allegedly squeezing out rivals by use of its Android mobile operating system.

This fine is almost double of what the U.S. tech company was slapped last year in the US (2.4 billion euros – a previous record) for misuse of its online shopping search service.

The record fine however will have no serious impact on the company as the fine imposed is worth just two weeks of revenues for Google parent Alphabet Inc. Additionally, the company also has cash reserves of $102.9 billion. However, this could open up a new war front in the trade war between the EU and the US.

Countering a reported remark by US President Donald Trump that EU antitrust chief Margrethe Vestager “hated” the US, she said that she very much liked the United States.

“But the fact is that this has nothing to do with how I feel. Nothing whatsoever. Just as enforcing competition law, we do it in the world, but we do not do it in political context,” she said.

Google said it would appeal the fine.

“We are concerned that today’s decision will upset the careful balance that we have struck with Android, and that it sends a troubling signal in favor of proprietary systems over open platforms,” Google CEO Sundar Pichai said in a blog.

It would be interesting to note that European Commission President Jean-Claude Juncker is slated to meet up with Trump next Wednesday at the White House to try and reverse the threat of new tariffs on EU cars even as the Trump administration continued to complain of its trade deficit with the EU.

Google has also been given a time period of 90 days by the EU antitrust body in which to bring an end to its anti-competitive policies in contracts and deals with smartphone makers and telecoms providers, else the tech company would have to cough up additional fines of up to 5 percent of parent Alphabet’s average daily worldwide turnover.

“Google has used Android as a vehicle to cement the dominance of its search engine. These practices have denied rivals the chance to innovate and compete on the merits. They have denied European consumers the benefits of effective competition in the important mobile sphere,” Vestager said.

When she was asked whether the issue could be resolved by breaking up Google as has been suggested by a number of rivals of Google, she said that she was unsure if it would servethe purpose.

“I don’t know if it will serve the purpose of more competition to have Google broken up. What would serve competition is to have more players,” Vestager told a news conference.

(Adapted from Reuters.com)

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