Innovation Being Hampered By EU Antitrust Regulators, Says Google

In a case that Google is fighting to overturn a 2.4-billion-euro ($2.6 billion) antitrust fine imposed by the European Union at Europe’s second-highest court, the search engine giant argued that innovation was at the core of its business model rather than helping out rivals in their businesses.

Many are closely watching this case because preparations are being made by the European Competition Commissioner Margrethe Vestager to bring in legislations that seek to limit the market power and better regulate United States based tech giants and Chinese companies in addition to the ongoing antitrust probes.

“Competition law does not require Google to hold back innovation or compromise its quality to accommodate rivals. Otherwise, competition would be restricted and innovation would be stifled,” the company’s lawyer Thomas Graf told a panel of five judges on the first of a three-day hearing at the General Court.

“The decision’s case is, at its core, that Google should not have introduced these innovations, unless it gave competing CSSs (comparison shopping services) the same access,” Graf said. This tussle between Google and the EU about the business practices of the most popular internet search engine of the world has been going on for about a decade now.

Graf said Google competed on its merits and did not favor its own service.

The huge fine was slapped against Google by the EU in 2017 over charges that the company gave preference to its own price-comparison shopping service over a number of smaller Europe based firms offering the same services.

The total penalty has since then has increased 8.25 billion euros because of two more decisions for different issues. The fine on Google is four times greater than the fine imposed by the EU on Microsoft at 2.2 billion euros.

The arguments by the lawyers of Google were dismissed by Commission lawyer Nicholas Khan and argued that the market dominant position of the company was being used by it to provide an advantage to itself while undermining the rivals.

“What Google engaged in was leveraging conduct of the type found to be abusive many times under EU competition law. Conceptually, there is nothing esoteric about this case,” he told the judges.

Google had selected some specific elements of the EU decision to challenge, he said criticisng the current case of Google.

“It is as if Google has applied a ranking algorithm to the decision and decided that parts of it just aren’t relevant,” Khan said.

If Google had treated its products in the same way as the products from its rivals, it own products would never have gained prominence, said Lawyer Thomas Vinje for British price-comparison shopping service Foundem, whose complaint triggered the EU investigation.

“But instead of being prone to being demoted, Google’s comparison-shopping service is systematically promoted to the most visible spots in Google’s search results,” he said.

Law enforces should be careful about not nipping innovation in the bud, said tech lobbying group CCIA, which backs Googles’ stance.

“There will be less innovation, and a worse outcome for consumers, if tech companies are disincentivized from improving their websites or adding new features,” CCIA lawyer James Killick said.

(Adapted from Reuters.com)

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s