In its third largest European Union antitrust penalty in the last two years, Google was fined 1.49 billion euros or $1.7 billion USD. This penalty, in particular, involves Google using its power to control the flow and pricing of search adverts from 2006 to 2016. This also marks 10 years of regulatory battles fought between Europe and Alphabet-owned Google. Specifically, the findings were that Google abused its dominance to stop websites using brokers other than AdSense. AdSense lets Google act as the middleman between advertisers and website owners. Google is appealing the fine.
These illegal practices in search advertisement brokering has led Google to pay 1.29% of its 2018 turnover. Google is preventing publishers from placing any search adverts from competitors on their search results. This, in turn, allowed Google to gain advert spaces on the pages that were more lucrative while also making sure they gave approval before any changes to rival adverts were made. The main issue is that as site owners and advertisers were given fewer options and forced to pay higher prices, the financial burden would be passed on to consumers.
At a news conference following the ruling Margrethe Vestager, the European Competition Commissioner, said: “Today’s decision is about how Google abused its dominance to stop websites using brokers other than the AdSense platform.”.
Adsense is Google’s own money-making and advertising program that allows publishers to promote through text, images, and videos within the Google Network. This works as a cost-per-click system where the price can range between $0.20 and $15 per ad click.
This case was triggered by a complaint placed by Microsoft Corp in 2010, which was dropped in 2016.
In two previous cases, Google stated that it would be taking action and would comply with all EU orders. These cases included one involving its Android mobile operating system, which ended in 4.34 billion euro fine and a shopping comparison case that led to a 2.24 billion euro fine (4.88 USD and 2.51 USD).
The Senior VP of Global Affairs, Kent Walker, stated, “We’ve always agreed that healthy, thriving markets are in everyone’s interest. We’ve already made a wide range of changes to our products to address the Commission’s concerns,”. He continued on to state that, “Over the next few months, we’ll be making further updates to give more visibility to rivals in Europe.”.
The chairman of one of Google’s competitors, Michael Weber, has made a statement in hopes of raising vigilance, “Competitors have withered or died. It’s time for the EU and governments around the world to step in and address the underlying wrong.”.
Despite this statement, going forward there is hope that this case will turn out well for all parties involved. Google has shown a positive change in both the Android and shipping cases mentioned above, and the EU antitrust chief has welcomed Google’s strives to give Android users the opportunity to choose their browser and search apps in order to boost competition.
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