When the U.S. Federal government got into the business of regulating large companies in the late 1800s with the Interstate Commerce Act, they showed a prescient streak by acknowledging big business and healthy bottom lines have little regard for state borders.
Old President Grover Cleveland, in signing the law that would ultimately regulate the massive railroad companies, could never have predicted a Google in which commerce doesn’t occur across state boundaries, or even across national boundaries.
Oh no. Google’s commerce takes place in a digital space that has almost no borders at all.
As such, the only way to determine if Google is running afoul of antitrust laws is to observe how much it promotes itself over other companies (something that used to be called marketing).
Anyway, The European Commission recently levied a record and staggering $2.7 billion fine on Google for violation of antitrust laws saying “the U.S. tech giant denied ‘consumers a genuine choice’ by using its search engine to unfairly steer them to its own shopping platform.”
“What Google has done is illegal under EU antitrust rules,” said Margrethe Vestager, the bloc’s top antitrust official. “It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation.”
Basically, the allegation is that Google gave their own shopping platform prime real estate in their search results and relegated competitors to areas that the Commission found consumers would be less likely to click.
For their part, Google “respectfully disagrees,” saying they plan to study the ruling as they craft an appeal.
This is just the latest salvo in the battle between giant American tech companies and the European Commission, with Microsoft, Apple and Facebook all facing their own tax and antitrust battles over the last several years. Even non-tech companies like Nike and Comcast have been targeted by the EU for how they sell licensed merchandise according to the CNN report, leading some to speculate that there is an anti-American bias within the EU.
“We have grave concerns about this fine which appears, once again, to justify our long held concerns about EU antitrust overreach adversely affecting U.S. companies,” said Gary Shapiro, the president of the Consumer Technology Association, the tech sector’s industry body.
Some of Google’s American competitors — Yelp and Oracle among others — have openly supported the Commission’s sanctions on the tech giant. Others, including the Consumer Technology Association, have begun to search on Capitol Hill for help in fighting what they’re sure is bias, even circulating a draft letter in support of Google Monday.
A copy of the draft letter, seen by the Financial Times, began: “We are writing to express our deep concerns about the European Union’s aggressive and heavy-handed antitrust enforcement action against American companies.” The cases were being “driven by politics and protectionist policies that harm open-competition practices, consumers, and unfairly target American companies,” it continued.
The EU is insisting there is no bias against Google or any American company. However, given the support of the Brexit effort from the United States, it’s not difficult to see why observers think the EU may be engaged in a little payback.