EU launches antitrust investigation into Google Search

30 Nov 2010

The European Commission has opened an antitrust investigation into allegations Google abused its dominant position in online search. Google refutes this, saying it has always tried to do the right thing.

The EU says it is launching the investigation because rival search service providers have claimed Google violated EU rules. They allege unfavourable treatment of their services in Google’s unpaid and sponsored search results, coupled with an alleged preferential placement of Google’s own services.

“This initiation of proceedings does not imply that the Commission has proof of any infringements. It only signifies that the Commission will conduct an in-depth investigation of the case as a matter of priority.”

The legal base of this procedural step is Article 11(6) of Council Regulation No 1/2003 and article 2(1) of Commission Regulation No 773/2004.

Google’s internet search engine provides for two types of results when people are searching for information.

These are unpaid search results, which are sometimes also referred to as “natural”, “organic” or “algorithmic” search results, and third-party advertisements shown at the top and at the right-hand side of Google’s search results page (so-called paid search results or sponsored links).

The Commission will investigate whether Google has abused a dominant market position in online search by allegedly lowering the ranking of unpaid search results of competing services which are specialised in providing users with specific online content, such as price comparisons (so-called vertical search services) and by according preferential placement to the results of its own vertical search services in order to shut out competing services.

The Commission will also look into allegations that Google lowered the Quality Score for sponsored links of competing vertical search services. The Quality Score is one of the factors that determine the price paid to Google by advertisers.

Google’s response

However, Google has refuted this. It said in a statement: “Since we started Google we have worked hard to do the right thing by our users and our industry – ensuring that ads are always clearly marked, making it easy for users to take their data with them when they switch services and investing heavily in open source projects.

“But there’s always going to be room for improvement, and so we’ll be working with the Commission to address any concerns,” the company said.

The European Commission’s probe will additionally focus on allegations that Google imposes exclusivity obligations on advertising partners, preventing them from placing certain types of competing ads on their websites, as well as on computer and software vendors, with the aim of shutting out competing search tools.

Finally, it says it will investigate suspected restrictions on the portability of online advertising campaign data to competing online advertising platforms.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years