Google slapped with $1.7 billion EU antitrust fine

Google has been slapped with a massive antitrust fine by the EU
Image: Google

Recently, the European Union (EU) levied a €1.5 billion ($1.7 billion) antitrust fine against Google.

The organization held a press conference on March 20 where Margrethe Vestager, the EU’S European Commissioner for Competition, laid out its case against the tech giant. Vestager stated the corporation had used its market dominance to force local firms into unfair advertising agreements for a decade.

In 2006, the Silicon Valley firm began offering a controversial service called AdSense for search. It allowed clients to generate revenue by installing a Google search box on their websites. Whenever the search box was used, it returned results and advertisements. Google would then split the ad revenue with the owner of the site.

However, Google’s AdSense for search agreements included language prohibiting its partners from embedding rival search tools on their platforms. The Big Tech conglomerate kept the policy in place with a few modifications until 2016. That same year, the EU began investigating whether or not Google’s advertising practices violated its antitrust laws.

In a prepared statement, Google vowed to work with the antitrust commission to increase the visibility of its European rivals.

Google’s Recent Problems in the EU

The €1.5 billion antitrust fine is the third penalty the EU has assigned Google in as many years.

Last year, the EU levied a record €4.3 billion ($5 billion) penalty against the company for bundling its Chrome browser and search engine into the operating system of locally sold Android phones. Moreover, the consortium found that Google prevented phone manufacturers from selling mobile devices with open source iterations of Android.

In 2017, the EU slapped Google with a €2.42 billion ($2.7 billion) sanction for misusing its search algorithms. The alliance argued the firm directed users to its Google Shopping service when they looked up price comparisons. Currently, Google is appealing its 2017 and 2018 fines in the EU’s court system.

With the new penalty, Google now owes the EU €8.2 billion ($9.3 billion). In 2018, the tech industry titan brought in $136.8 billion in revenue.

While Google is dragging its heels on paying its fines, it’s taking a more proactive approach regarding its business practices. The corporation recently announced it will present European Android users options regarding their default mobile internet browser and search engine.

Will America Follow Europe’s Lead?

Although Google has faced increased government scrutiny over its business practices in Europe, the same cannot be said about its American operations. When Google was hit with its second EU fine, U.S. President Donald Trump criticized the coalition for its impertinence. His perspective was that the organization was taking advantage of “one of our great companies.”

However, some of Trump’s opponents in the upcoming 2020 presidential election have taken a different tack. Earlier this month, Senator Elizabeth Warren laid out a proposal to dismantle Google because of its alleged monopolistic practices. Since that announcement, several notable Democratic and Republican lawmakers have called for increased regulation on Big Tech.

If Warren or one of her contemporaries wins the election next year, it could be a serious problem for Google. The new president could direct the Department of Justice to launch an antitrust investigation into Google similar to the one it conducted against Microsoft in the late 90s. If a judge then ruled Google a monopoly, the once-dominant firm might become a minor market player.