Google Fined $2.7 Bil­lion for Il­le­gal Search Ma­nip­u­lat­ing Prac­tices

The Star (St. Lucia) - - BUSINESS -

The Euro­pean Union struck one of the world's big­gest tech giants with a $2.7 bil­lion reg­u­la­tory fine on Tues­day. The EU as­serts Google is un­fairly fa­vor­ing some of its own search ser­vices over ri­val search en­gines.

The EU's in­ves­ti­ga­tion into Google in­cluded com­pany doc­u­ments, ex­per­i­ments and sur­veys, fi­nan­cial data and 5.2 Ter­abytes of Google search re­sults, con­clud­ing that the tech mam­moth had ma­nip­u­lated its search en­gine to fa­vor its own prod­uct, an on­line shop­ping ser­vice.

"Google has abused its mar­ket dom­i­nance as a search en­gine by giv­ing an il­le­gal ad­van­tage to an­other Google prod­uct, its com­par­i­son shop­ping ser­vice," the EU said in a state­ment.

Google is re­quired to end what the EU says are abu­sive prac­tices within 90 days, or will be fined penalty pay­ments up to five per­cent of the av­er­age daily world­wide turnover of its parent com­pany, Al­pha­bet.

"What Google has done is il­le­gal un­der EU an­titrust rules," Mar­grethe Vestager, EU Com­mis­sioner, said in a state­ment. She added that the tech giant's prac­tices de­nied other com­pa­nies the chance to com­pete, but "most im­por­tantly, it de­nied Euro­pean con­sumers a gen­uine choice of ser­vices and the full ben­e­fits of in­no­va­tion."

In 2004, Google en­tered the on­line mar­ket­place in Europe with "Froogle," later re­named "Google Shop­ping" in 2013. The EU is as­sert­ing that Google - a com­pany that gen­er­ates nearly 90 per­cent of its rev­enues from on­line ad­ver­tise­ments - rigged its widely-used search en­gine to show its own shop­ping ser­vices first.

The EU says that when users searched for a prod­uct, Google Shop­ping would show at the top of search re­sults, while other highly-ranked ser­vices like Ama­zon or eBay ap­peared on av­er­age on the fourth web­page of Google re­sults. Ev­i­dence re­port­edly shows that the 10 high­est-rank­ing search re­sults on the first web­page gen­er­ate 95 per­cent of all clicks, and the sin­gle top re­sult re­ceives about 35 per­cent of all clicks.

Ac­cord­ing to the EU, Google's search ma­nip­u­lat­ing be­gan in Ger­many and the United King­dom in 2008, ex­tend­ing over the next five years to 11 other Euro­pean coun­tries. Such a prac­tice would breach EU an­titrust rules, which say that dom­i­nant com­pa­nies must up­hold their "spe­cial re­spon­si­bil­ity" to "not abuse their pow­er­ful mar­ket po­si­tion by re­strict­ing com­pe­ti­tion."

Google is not the first Amer­i­can tech com­pany at which the EU has taken aim. A re­port by The New York Times said that EU Com­mis­sioner Vestager has made ag­gres­sive strides to reg­u­late Sil­i­con Val­ley giants.

Such fights have in­cluded a de­manded re­pay­ment by Ap­ple to Ire­land of $14.5 bil­lion in taxes, an open in­ves­ti­ga­tion into how Ama­zon han­dles taxes in Europe, and pok­ing into Facebook's al­leged dom­i­nance over users' dig­i­tal data.

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