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EU Antitrust Chief: Google "Diverting Traffic" & Will Be Forced To Change

Posted by samzenpus on from the shape-up dept.

Dupple writes "It looks like the EU is coming close to a decision regarding its investigation of Google. While saying he's 'still investigating,' the head of the European Union's antitrust regulatory body has said that he's convinced Google is 'diverting traffic' and that it will be forced to change its results. From the article: 'Despite the U.S. Federal Trade Commission's move earlier this month to let off Google with a slap on the wrist -- albeit, a change to its business practices, a move that financially wouldn't dent Google in the short term but something any company would seek to avoid -- the European Commission is looking to take a somewhat different approach: take its time, and then hit the company hard.'"

30 of 329 comments (clear)

  1. nonsensical allegations by Anonymous Coward · · Score: 5, Insightful

    What the hell do they mean by "diverting traffic", and why would it not be allowed?

    What, exactly, does Google have a monopoly of, and how are they abusing monopoly power in any way?

    TFA suggests they have a monopoly on "search" which is nonsensical, since there are many competitors and no barrier to entry, and they give the "product" away for free, so it would hard to claim any monopoly pricing power is even being used or existing.

    A more sensible allegation would be that they have some kind of monopoly on advertising or user data collection, since that at least they charge for, except, that as far as I can tell, they don't have that either.

    So, all in all, it looks like either a blatant cash grab by the EU, or a bullshit legal attack funded by the likes of Microsoft.

    1. Re:nonsensical allegations by Anonymous Coward · · Score: 3, Insightful

      So exactly what every search engine has done since the dawn of time.

    2. Re:nonsensical allegations by rossdee · · Score: 3, Insightful

      And The EU has no authority over what google.com does, since its not based in the EU
      They have some jurisdiction over the european subsidiaries like google.fr b ut don't most searches go through google.com anyway? Except for those people who want to use a foreign language, and a lot of eurpeans are fluent in english anyway.

    3. Re:nonsensical allegations by FireFury03 · · Score: 5, Informative

      What the hell do they mean by "diverting traffic", and why would it not be allowed?

      It looks like they're talking about doing stuff like including results from Google Maps in your web search results (whilst not doing the same for results from Bing Maps, etc.).

      What, exactly, does Google have a monopoly of, and how are they abusing monopoly power in any way?

      They are the dominant search engine, and the EU appears to be deciding that they are using that dominance to help gain dominance in other markets (e.g. the aforementioned maps, amoungst others).

      TFA suggests they have a monopoly on "search" which is nonsensical, since there are many competitors

      They are the dominant search engine. I think you are misunderstanding antitrust legislation:
      - Antitrust legislation doesn't care whether or not you have competitors, it only cares whether you are the *dominant* vendor. As a well known example, Microsoft was found guilty of antitrust violations in their operating system business, but there have always been other operating system vendors. The key was that they were the *dominant* vendor.
      - Antitrust legislation doesn't say there's anything wrong with being the dominant vendor (or even the only vendor). All it says is that if you are dominating the market, you're nor allowed to use that dominance to help you gain dominance in other markets. So going back to the Microsoft example, they were dominant OS vendors, and by shipping certain freebies with the OS (e.g. a web browser) they were unfairly using their existing position to gain dominance in the browser market. Netscape, on the other hand, could never have hoped to do this since they weren't shipping anything which already dominated the market, with which to bundle their browser to compete. The EU is saying Google is using their dominance in the search engine market to push their other products in a way that is unfair to their competition.

      and no barrier to entry

      There's always a barrier to entry - setting up a search engine is going to involve R&D and then a hell of a lot of time and bandwidth to spider the web. However, that isn't what this is about - this isn't about Google doing anything to stop people competing in the search engine business, this is about using their existing search engine position to make it harder for people to compete in other sectors.

      and they give the "product" away for free, so it would hard to claim any monopoly pricing power is even being used or existing.

      No one said anything about pricing. It isn't relevant to this discussion.

      So, all in all, it looks like either a blatant cash grab by the EU, or a bullshit legal attack funded by the likes of Microsoft.

      Or the EU is trying to level the playing field for the smaller businesses. Whilst having everything run by a single megacorp is convenient, historically it has always been better for the consumer in the long run to have many smaller businesses offering services. The EU usually takes the attitude that a bit of short term pain (inconveniencing people by preventing the "convenient" integration of services from a single vendor) is better than the long term pain of having a single megacorp in control of huge markets and no chance for a smaller business to survive.

      --
      http://blog.nexusuk.org
    4. Re:nonsensical allegations by Anonymous Coward · · Score: 5, Informative

      No Country Redirect: www.google.com/ncr

    5. Re:nonsensical allegations by aaron552 · · Score: 5, Insightful

      IIRC, the problem is that Google's own services appear to be favoured in search rankings over competitors. I would think that this is primarily be because they're significantly more popular than the competitors, though, and not due to any bias on the part of Google.

      A search for "email" on Google returns Hotmail as the first result and "web browser" gives an ad for IE, the wikipedia page for "web browser", Opera, and Firefox before Chrome appears. There doesn't seem to be anything particularly shady on there based on my rather unscientific test.

      --
      I had a sig once. It was lost in the great storm of '09.
    6. Re:nonsensical allegations by Anonymous Coward · · Score: 3, Interesting

      But then they have to start paying taxes.... And the tax break they get laundering their money through Ireland an the Netherlands is a lot bigger than a possible fine...

    7. Re:nonsensical allegations by Genda · · Score: 5, Funny

      I just did a search on just "Beer" and the first thing to show up was "Sam Adams", I'm guessing that right there would be enough to start a war with the German's and we all know as goes Germany so goes the EU...

    8. Re:nonsensical allegations by Anonymous Coward · · Score: 4, Insightful

      Welcome to the filter bubble anyway. It shows Hotmail first for YOU. It actually shows Gmail first for me.

    9. Re:nonsensical allegations by Anonymous Coward · · Score: 4, Informative

      Once again I am pointing out a Troll that got moderated to +5 Insightful:

      Poster said:

      nonsensical allegations

      Both the European Union and Google's own American Government said that they were breaking the law. I take it these super powers have lawyers, economists and stuff like that making arguments based on international law and trade agreements. NOWHERE, and I mean no where in your post do you point out what is a "nonsensical allegation". You don't cite any law, any United Nations charter, any trade agreement, you don't even cite a verse from the Bible (which I was half expecting from you).

      Poster said:

      What, exactly, does Google have a monopoly of, and how are they abusing monopoly power in any way?

      You use the word "monopoly" throughout your post. In fact your entire post is based on YOUR claim that these unfair, greedy Europeans want to make money off of Google because it is a "monopoly". Unfortunately for people who are interested in the TRUTH, the source article by ZDnet does not mention anything about a monopoly or anti-monopoly legislation. So your whole argument is based on a lie and yet you get up-moderated to +5 (I'm hoping and expecting this will change as newer Moderators see through your Bullshit... as is often the case).

      Just out of Interest the comments on ZDnet are highly biased against the EU as well. I get the feeling that most Americans feel that if some negative judgment is made against one of their Corporate status symbols, that this is somehow anti-American, and the result of people who are obviously more stupid than Americans. I will give examples:

      The EC should shut up...
      and follow the American leadership

      and

      ... and Google should being immediately blocking all EU IP's from accessing their system.

      and

      Why is Almunia talking to the press like this ? Abuse of Power or did promises of a large amount of money loosen his lips?

      and

      The EU will use whatever tactics they believe will extract funds form internet companies. If they can't manage to tax them they will fine them to get the money.

        Oh yes, unfortunately I see the same type of people posting the same types of arguments on Slashdot as well. Too bad.

      Unlike the parent poster (who got moderated to +5 Insightful!), I will supply you with a reference to my evidence:
      http://www.zdnet.com/eu-antitrust-chief-hints-at-forced-changes-for-google-7000009665/

    10. Re:nonsensical allegations by theVarangian · · Score: 3, Interesting

      So? Even if they were, why is that a problem? A search engine exists for end users to find what they're looking for, not to give commercial entities some sort of equal platform for advertising. I ask a question, Google tells me what it thinks the best answer is. What does the EU want? The ability to vet Googles' search algorithms?

      What does the EU want? It wants Google, a company that has a monopoly on the search engine market, to stop abusing it's dominant positon which it is allegedly now using to try and kill off competitors by wilfully burying results that link to their (competing) services. I don't think the EU gives a rat's ass about what is in Google's blackbox as long as you can put in your search term and get output int the form of fair and balanced search results. I watched a documentary yesterday where an industry observer described Google as an 'adolescent' and postulated that we have not yet seen the real giant that Google will become. Now if somebody had taught Microsoft some manners back when it was still a teenager perhaps we would have been spared a whole lot of pain over the years. Microsoft was only taught a modicum of manners (by the EU) when it was far too late but perhaps we can avoid the mistakes we made with MS by teaching Google to behave before it is once again too late and the damage is done.

    11. Re:nonsensical allegations by FireFury03 · · Score: 3, Informative

      It looks like they're talking about doing stuff like including results from Google Maps in your web search results (whilst not doing the same for results from Bing Maps, etc.).

      This is not an antitrust violation. It's normal business practice for every search engine.

      Firstly I'm not saying it is an antitrust violation (IANAL and don't have any particularly strong opinions either way anyway), I'm just explaining what the EU appears to be saying.

      However, I'm not convinced that you can say its completely innocent behaviour either. A search engine is supposed to find the most relevant results for what a user is searching for. Google is intentionally adding in results relating only to their own services, even though similar services exist from other companies. Using the maps example, if I search for a business then I'll get:
      1. that business's home page on the web
      2. people talking about that business on the web
      3. a link to google maps showing me where the business is
      In the case of (3), Google has intentionally included a link to a relevant page on a separate service that they also own. They haven't provided a similar link to other map services, such as Bing, Openstreetmap, etc. Whether this is right or wrong is debatable, but it is clear that they are using their search engine to promote their own maps service over their competitors', and this search result appears amoungst all the normal results, not as a "paid advertisement" (which is what happens to all the other artificially promoted responses).

      And yes, you can say that other search engines do the same, but the point is that other search engines aren't in the same dominant position and therefore antitrust legislation doesn't apply to them. This is the same as pointing at things Microsoft isn't allowed to do and saying "well Apple/Ubuntu/Fedora does them" - dominant companies have to play by different rules to everyone else in order to keep the playing field more level.

      You're misusing the Microsoft example. Microsoft wasn't just the dominant vendor, they were actively engaged in anti-competitive practices. At the time they got slapped with antitrust fines you could not buy a computer without windows. It wasn't possible. Any computer you purchased from a store came with their system preinstalled.

      This is untrue. You have *always* been able to buy computers without Windows. There have been several antitrust cases against Microsoft; the one you seem to be referring to was where MS were pressuring OEMs to only supply machines preinstalled with windows by offering them substantial discounts for doing so. There were ways the vendors used to get around this, and so you could still buy machines without Windows, but it was more difficult to do so than it should have been.

      More recently, there was an antitrust case against Microsoft because they shipped IE with the OS by default, in a way that prevented the OEMs from removing it and replacing it with a competing browser. The EU decided that this was unfair since MS were using their dominant position in the OS market to push their browser in detriment to other browser vendors. This is very similar to what the EU is suggesting that google is doing - using their dominance in the search engine market to bundle other products at the detriment to their competitors.

      This is quite the opposite from someone firing up their computer and oh look Internet Explorer is the default browser and Bing is the default search engine and the end user is forced to make an informed choice.

      In your example, someone made a choice to buy a Windows machine and found that IE and Bing were bundled by defaults. So long as they stick with Windows, they have to go out of their way to use a different vendor's browser or search engine.

      Similarly, someone made a choice to use Google and found that Google Maps, etc. were bundled into the search results by defau

      --
      http://blog.nexusuk.org
    12. Re:nonsensical allegations by Anonymous Coward · · Score: 3, Insightful

      I don't think this would have been a problem if it would have been clear to the end user that the top results is payed for rather than being "most relevant" to their search.

      You mean if they'd put a different coloured background under the sponsored results and adding the text "Ads for [foo]"?

    13. Re:nonsensical allegations by FireFury03 · · Score: 3, Interesting

      So what you're saying is, if Google is just using an algorithmic search method, and it happens to select their own sites because they are popular in their own right and legitimate results, they're not doing anything wrong?

      No. If you go to google's web search and you search for a local business, amoungst all the search results, fairly near the top, it will give you a link to Google Maps showing you where that business is. It won't give you a link to bing maps, openstreetmap, etc. This isn't because google maps is more popular, its because google integrate their own mapping product with their search engine but don't integrate competing products with it. Google *could* provide an API to allow other services to integrate, but they don't.

      --
      http://blog.nexusuk.org
    14. Re:nonsensical allegations by FireFury03 · · Score: 5, Insightful

      So the lesson here is that if you build a business, develop something that's really awesome and becomes the go-to choice for nearly everyone on the planet, your reward is to be considered a monopoly and regulated as a utility?

      Your reward is that you have a business that is worth billions. There is a very minor penalty that you have to adhere to slightly stricter regulations as a result. Its good for the consumer for the dominant company to have to work at staying dominant rather than sit back and stagnate since no one can compete.

      There are always penalties associated with being successful, but the success generally outweighs the penalties. Or are you going to complain that successful high-profit companies shouldn't have to pay more tax than low-profit businesses because that would be a penalty on their success?

      --
      http://blog.nexusuk.org
    15. Re:nonsensical allegations by FireFury03 · · Score: 3, Insightful

      But what Google is doing is no different than what other search engines are doing. If I search for "Starbucks" on Bing, I get the web results I'd expect. I also get a Bing Map for Starbucks in the area. I also get Bing News results for articles about Starbucks.

      Yes, and the point of antitrust legislation is that if you get big enough to unfairly distort markets then you have to play by different rules to ensure you don't distort the markets. Google is far more dominant than Bing, so they get hit with the antitrust stick for their troubles. Guess what? Apple gets away with stuff MS could only dream of because they aren't the dominant player.

      --
      http://blog.nexusuk.org
    16. Re:nonsensical allegations by MacGyver2210 · · Score: 4, Informative

      I don't know about other languages and countries, but in the US we have this little "Sponsored Results" label. Barring some large shift in English vocabulary, "Sponsored" is quite equivalent to "Bought and Paid For".

      It also hasn't been illegal to have paid-for results top your search: as a search engine their algorithm and results sorting, etc, are all proprietary. They can keep them as black-box as they like, and as long as the product functions as they want it to, they aren't doing anything wrong. It is THEIR BUSINESS, and is not up for some money-grubbing politicians to cry foul about ad revenue 10 years after the fact.

      So sick of software patents, EU regulation nonsense, China vs Japan, Fiscal Cliffs, Republicans, China vs US, all this crap. Someone start a war against aliens or robots or something, so we can act like one large compassionate human population for a change. It works in the movies....aww, who am I kidding.

      --
      If the only way you can accept an assertion is by faith, then you are conceding that it can't be taken on its own merits
    17. Re:nonsensical allegations by FireFury03 · · Score: 4, Insightful

      Fine, but when you go to GOOGLE and search for MAPS...don't piss and moan when the first result that comes up is Google Maps. Not only are they the most popular mapping service by a mile, but it is owned and promoted by GOOGLE...the search engine you are using at the time. Of course Google is going to put a little map in your results and say "Hey, we've got this map service...".

      When you go to WINDOWS and open the BROWSER...don't piss and moan when it starts IE. Not only is it the most popular web browser by a mile, but it is owned and promoted by MICROSOFT...the operating system you are using at the time.

      --
      http://blog.nexusuk.org
  2. Re:No google for u! by FireFury03 · · Score: 3, Insightful

    The EU apparently don't need the internet.

    Yes, because the Internet doesn't exist without Google... </sarcasm>

    --
    http://blog.nexusuk.org
  3. Serious? by Aeros · · Score: 5, Funny

    These are just two guys running a simple home grown search engine in their dorm room in college. Give these poor guys a break. Freakin' EU!

  4. Occam's Razor by Anonymous Coward · · Score: 3, Insightful

    Alternatively, those 'scam' sites may do what they do- a great deal of search engine optimization. It was merely a niche market that isn't re-spidered and indexed very often and it's turn came up at the first of the year, no doubt along with many other niche search terms. The index was updated and tada! now all those old, reputable, and not very SEO savvy businesses get to go for a swim in the search results while the modernized middlemen rise to the top.

  5. Re:Thanks Government by Anonymous Coward · · Score: 4, Insightful

    I have 8 (!) Internet access providers where I live, all of whom provide cheap uncapped bandwidth.

    Not one of my friends in the US has more than 3 and none of the ones I talk to on a regular basis has access to cheap uncapped bandwidth.

    I can buy any mobile handset and use with any carrier. I buy a "Samsung" or a "Nokia" not a "T-mobile" handset.

    The reason we have this freedom is because we take free markets a bit more seriously than you colonials do and we actually enforce the freedom of the market, something a free market is incapable of doing itself (although it does a number of other things very well).

    Free markets are not free by virtue of design. They are kept free by regulation.

  6. Re:No google for u! by Thantik · · Score: 4, Funny

    The internet still exists, it's just awfully hard to find.

  7. Google should start supporting web search again by kasperd · · Score: 4, Interesting

    Web search was Google's primary business, which is why they stopped doing it. Sounds strange? Nevertheless that is roughly what happened.

    Initially there was google.com, and it was a web search engine. Later Google started introducing other kinds of searches, which would be hosted on subpages/subdomains of google.com. Since web search was the primary business, it remained on the front page.

    At some point Google thought it would be good for the users if they could type in their search query in one place and get merged results from all of the different kinds of search, which Google is offering. That was introduced a few years ago, and it was considered such a great idea, that it would go on the front page, displacing the web search.

    All the other kinds of search still had their own URLs, on which the individual kind of search could be used. But Google websearch never had such a page in the first place, because it had been on the front page. So now Google is no longer offering websearch alone.

    Google should reintroduce the websearch on a subdomain like web.google.com or similar. And it should also introduce a subdomain for the merged search like everything.google.com (or something shorter). Having those existing as separate pages allowing you to search them separately is both a service to the users, who sometimes want to search specific kind of content, and also clears up some of the confusion leading to stories like this one.

    Once those two kind of searches each have their own page, the remaining question is which of them users should see when they just go to google.com. At that point authorities will sound even more stupid, once they come and say, you are not allowed to show all search results from the front page, only web search. But it would be less of a problem for Google to comply, because even if it does comply, the search page with all results, which users prefer, will still exist on a slightly longer URL.

    While they are at it. I think they should also introduce ads.google.com or something like that, where you can go if you specifically want to search in ads. Payment rules should be slightly different for such a page. A larger percentage of users are likely to click on an ad on such a page, and the price per click should be adjusted down accordingly. Additionally those are users who want to see the ads, and thus should be shown any appropriate ads, even if the advertiser is out of budget.

    --

    Do you care about the security of your wireless mouse?
    1. Re:Google should start supporting web search again by swillden · · Score: 3, Informative

      Web search was what they did for a while.

      The goal always has been, and will be, showing ads and getting companies to pay them to show ads.

      Everything else follows from that. The search is not the product, the eyeball using the search is.

      This is actually precisely backwards from how Google employees and the company leadership -- all the way up to the CEO -- see it.

      Google started as an idea for searching the web, implemented on donated and scrounged hardware in a dorm room and using the university's Internet connection. Eventually traffic rose to a point where it was causing problems for Stanford, so it had to move out, which meant it had to find a way to fund itself. The founders were opposed to using advertising as the revenue source, but couldn't find anything else workable. Even then they didn't find advertising acceptable until they realized that advertising can be useful to the user, if it's relevant and not obnoxious.

      That attitude is still what drives Google. The goal is all of the products that users use. When new ideas come up, the first question is whether or not it's cool and will improve peoples' lives. Whether or not there's a way to monetize it comes up much later. Of course, if there isn't a way for it to be profitable Google probably won't do it, because the bills have to be paid, but generally any product that's sufficiently useful to a sufficiently large number of people will have some way of paying for itself and generating a profit. Advertising is a monetization approach that works for many products, doesn't create a large barrier to usage, and often creates revenues that grow naturally alongside usage (and therefore cost), so it's widely used.

      The point, though, is that products are the goal, and advertising is (usually) the means.

      (Disclaimer: I work for Google, but not as a spokesperson. The above reflects my view of the company's motivations from my perspective inside the company, but is not any sort of an official position.)

      --
      Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
  8. Re:No google for u! by TheRaven64 · · Score: 4, Insightful

    I've been using DuckDuckGo as my primary search engine for about 18 months. If it can't find what I need, I try Google. In the last year, Google has only once found something that DDG didn't find. If Google decided to pull out of the EU, I think it would hurt them a lot more than it would hurt us...

    --
    I am TheRaven on Soylent News
  9. Keep on dreaming by dutchwhizzman · · Score: 3, Interesting

    Google has a profile on you and they have your android device(s) and your home ISP perfectly matched up to that. Even if you don't own android and don't have a google account, they have a "virtual profile" on you. Not only that, but even if you never use google services even as an anonymous user, they probably have your home address and telephone number in their database, including an IP address for your home computer. Yes, thank the people you gave that information to that put it in their android device, which get synced, how conveniently, to Google's cloud.

    Google may not be actively telling that they have this information nicely catalogued available to themselves. They may not even have all their internal applications linked exactly this way, but we all know it would be trivial for them to come up with the queries to produce the information I just described. Once there's profit in doing so, they most certainly will do it in a heartbeat. Since several large companies (the "Target knows you're pregnant" article comes to mind) have already admitted they profile their customers/users this way, it'd be very unrealistic for Google not to do this. If even a grocery store can make money on this, a company that makes their money on selling user demographics would most certainly profit from virtual profiles and linking based on probability.

    --
    I was promised a flying car. Where is my flying car?
  10. Ordering a Big Mac at Burger King? by louic · · Score: 3, Insightful

    If I go to Burger King, should I complain that they don't have a Big Mac on the menu? When I go to Google, I go there because I WANT a Google Maps result!

  11. Re:No google for u! by Bengie · · Score: 5, Interesting

    Too bad DDG doesn't track me like Google does. I get much better results from Google because it tracks me and integrates into gmail and G+. I don't see it as much as a privacy concern as much as I do an optimization. Data collected from tracking is highly relevant to my search results.

  12. Guilty until your rivals are "convinced" otherwise by miltonw · · Score: 3, Insightful

    A response from the commissioner is understood to be imminent, after Almunia's office told Google in mid-December that it must convince its rivals that it competes fairly in the web search market or else it could - within months - face sanctions for alleged "abuse of dominance".

    I found this statement very strange. Especially in light of the principle of "innocent until proven guilty". Apparently, the EU doesn't have to prove Google broke the law. Even stranger, the EU is not asking Google to prove that they didn't break the law.

    No, it seems to be much worse. Google must "convince its rivals that it competes fairly" or face sanctions that its rivals desperately want.

    It just boggles the mind.