The EU is taking anti-competitive allegations regarding the search industry with great attention but Google said it is "confident" is has a "good case" after EU competition commissioner Joaquim Almunia stated that he is "looking at the allegations very seriously."
Although he did not name Google during his speech in London, Almunia's statement is clearly directed at the search engine against whom three antitrust complaints were filed five months ago, from UK search service Foundem, Microsoft's online shopping site Ciao and French legal service ejustice.fr.
Bloomberg reported Google senior competition counsel Julia Holtz as saying "We have a good case." "With success comes scrutiny," she said. The company further commented in a statement that it is "very confident" its "business operates in the interests of both users and partners, as well as within European competition law." "We're working with the commissioner and his team to answer their questions, including how Google's search ranking works to produce the most relevant and useful search results for users," the Mountain View-based Google added.
First EU Comments On Complaints
What Almunia said during his speech delivered at the University College London was that "the work is at an early stage, but given the importance of search to a competitive online marketplace, I am looking at the allegations very carefully." He added that "If companies do establish themselves in a strong position in a market, there may be risks that they will use this position to foreclose other markets." No formal inquiry has been launched yet.
This is the first time the EU commissioner has commented on the case since the complaints were filed and such comments have sparked much media interest, with the Telegraph estimating that "there could soon be an official inquiry."
Look At The Bigger Picture
Bloomberg quoted Matthew Readings, a London partner at law firm Shearman & Sterling as saying: "Almunia's comments show that Google is firmly on the commission's radar but it doesn't mean that enforcement action is imminent." He noted that "intervention in technology markets is not straightforward. The real issue is not so much Google's current market share, rather how online markets will develop and how contestable they are to competitors." Indeed, Almunia did indicate that Europe is willing to step up to the plate in terms of technology, as "the biggest web services were all developed overseas. We cannot afford to continue to miss the boat on so many different parts of the digital value chain."
Last week, the French competition body, Autorité de la concurrence, asked that Google reinstate French location data company Navx into its AdWords service as the search engine was found to have demonstrated discriminatory behavior against the company. The final judgement is to be expected in 10 to 12 months. At the same time, the Autorité de la concurrence was invited by the French government to submit comments on the online advertising market in the Fall.
This means that the EU and its member states are definitely on the case of the search industry as they catch up with its endless possibilities. Would it be another instance of EU vs US?...