European Union hits Google with record-breaking fine for 'stifling competition'

Google Hit With $2.7 Billion Fine By European Commission For Giving Itself An 'Illegal' Shopping Service Advantage

The decision announced Tuesday by the European Commission punished Google for unfairly favoring its own online shopping recommendations in its search results.

Google has 90 days to respond to the European Commission's demands, or it will face penalties up to 5 percent of its parent company's, Alphabet Inc., daily revenue.

It would seem that after seven years of investigation, bargaining, and small business outcry, the European Commission found that use of the company's algorithms in its Google Shopping service actively and intentionally undermined competitors which is an offense the EU takes very seriously. "The EU's actions have created a cloud of uncertainty that will make large tech companies overly cautious about making changes to the user experience and service offerings that would benefit consumers".

When it comes to online shopping, a big problem is that consumers don't spend enough time doing different searches and instead they focus on Google searches to find the best price, experts say.

The fine, equivalent to 3 percent of Alphabet's turnover, is the biggest regulatory setback for Google, which settled with US enforcers in 2013 without a penalty after agreeing to change some of its search practices.

April 2013 - Google offers change to its practice in the hope of ending the investigation. Even more significant could be a "non-discrimination obligation" imposed on Google, he said ahead of the announcement.

A few months later, a group of companies filed a complaint with the European Union regarding Google's Android mobile operating system, claiming its distribution for free was a way of locking down the mobile advertising and data market.

The EC also found Google guilty of demoting its rivals in its search results.

Google handed record €2.42bn fine for breaching competition rules in online shopping service.

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Google points to those two websites when tackling the question of why these other shopping comparison sites haven't grown.

"We will review the Commission's decision in detail as we consider an appeal, and we look forward to continuing to make our case", said a Google spokesperson in response to the ruling.

But the penalty is likely to leave a bigger dent in Google's pride and reputation than its finances.

Even so, Europe's crackdown is unlikely to affect Google's products in the USA or elsewhere.

We think our current shopping results are useful and are a much-improved version of the text-only ads we showed a decade ago.

Its parent company, Alphabet, now holds a cash pile of $92.4 billion as of March 2017.

Vestager rejected any suggestion of anti-American bias, telling reporters on Tuesday that an analysis of investigations her department has launched found that United States companies were not being disproportionately targeted.

She noted that that any company or person who has suffered damages due to the company's practices can make claims to national courts.

Vestager said the Commission's probe, which started in 2008, looked at some 1.7 billion search queries. This will affect other cases the Commission might build against the internet giant's various businesses, like Google Images.

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