After months of rumblings about potential action, it seems that the European Union is planning to accuse Google of antitrust violations. According to reports by the New York Times and Financial Times, European competition chief Margrethe Vestager is expected to charge that the company has abused its dominant position in the search market.
In particular, the EU is expected to take a particularly harsh look at Google’s policies around the placement of search results, including promotion of its own products like shopping and travel search over those of its competitors. In addition, Vestager is expected to launch a new investigation into Android, Google’s mobile operating system.
The charges tomorrow will likely come in the form of a Statement of Objections – a set of arguments that regulators lay out about perceived antitrust violations. After that, Google will have a chance to respond, and the regulators may revise their arguments or choose to settle.
It’s worth noting that Google is the overwhelmingly dominant player in the European search market, in contrast to the U.S., where it faces stronger competition from Bing, Yahoo and other search engines.
The company is obviously hopeful that it will prevail in any potential antitrust action. In an internal memo to employees published by Re/code, Google calls the move “very disappointing news,” but said that it has strong arguments against antitrust charges. In the search realm, the memo emphasized that Google’s “competition is just one click away — and it’s growing.” What’s more, it notes that its Travel and Shopping products have plenty of competitors, including TripAdvisor and Amazon.
All of this comes after a five year process of investigation and settlement negotiations between European regulators and Google. Joaquin Almunia, Vestager’s predecessor, previously came to three different negotiated settlements with the search giant, but all of them were criticized for not going far enough in punishing Google.
In the event the regulators rule against Google (which could take years) the E.U. could levy a fine as large as $6.4 billion, or about 10 percent of Google’s annual revenue.
