What it all means for the Alphabet unit

THE EU HANDED down a record €2.42 billion (R34.89bn) fine to Alphabet unit Google yesterday for breaching EU antitrust rules after a seven-year investigation prompted by complaints from both sides of the Atlantic. The following is a quick summary of the EU decision and Google’s other regulatory issues.

The fine represents 3 percent of Alphabet/Google’s turnover in 2016. The biggest sanction prior to that was US chip maker Intel’s €1.06bn fine in 2009.

The commission found that Google had systematically given prominent placement in searches to its own comparison shopping service and demoted those of rivals in search results. The commission wants the company to stop that, or face additional non-compliance payments of 5 percent of Alphabet’s average daily global turnover.

The action came after a seven-year long investigation prompted by scores of complaints from rivals such as US consumer review website Yelp, TripAdvisor, UK price comparison site Foundem, News Corporation and lobbying group FairSearch.

Google may choose to appeal in EU courts, but Intel, the previous antitrust fine record holder, has waited seven years for a final judgment on its appeal. Google remains under commission investigation in two other cases.

Google and other US-based internet companies face increasing scrutiny and regulation from the EU regarding user privacy and data storage, most recently on messaging, e-mail and voice services. The EU largely expects greater co-operation from tech companies on cyber security and counter terrorism. On Monday, Facebook, Google’s YouTube, Twitter and Microsoft responded with the announcement of a Global Internet Forum to Counter Terrorism.

The commission has a number of ongoing cases involving technology giants, notably Qualcomm, which was accused in 2015 of using financial incentives and predatory pricing to force out competition. – Reuters