Google is to pay 2.95 billion euros for violations of European competition law in the advertising market. This was announced by the EU Commission late on Friday afternoon. “Google has abused its position by favoring its own advertising technology over competitors”, according to a statement by the responsible EU Commission Vice-President Teresa Ribera. Her Directorate-General for Competition is responsible for sanctioning anti-competitive behavior – and has already done so several times in the case of the Google advertising empire. According to the EU Commissioner, Google’s behavior caused higher advertising expenses, which were then very likely passed on to consumers by advertisers. Google had carried out its unlawful business practices for over 10 years.
However, after two fines have already been imposed on Google in the context of its advertising business, the EU Commission does not want to leave it at just a fine: “The conduct affected by today’s decision has a global dimension”, the communication continues. Google must now credibly demonstrate within 60 days how it intends to make its advertising business compatible with European law. Otherwise it will take further appropriate measures, Ribera said.
EU Commission able to act
“The billion-euro fine against Google shows that the European Commission is capable of acting,” commented Green MEP Alexandra Geese. Google’s market power in online advertising is damaging to the press and democracy, says Geese, who sees today’s decision as “the first step towards breaking Google’s monopoly on power and data in the advertising market.” However, even at almost 3 billion euros, the amount is only peanuts for Google; the company is said to have recently achieved annual sales of around 100 billion euros in Europe.
According to Bloomberg, the responsible Google Vice President Lee-Anne Mulholland immediately announced her intention to take legal action against the fine. The Group’s advertising business, which has made the company one of the most profitable ventures of the internet age, has repeatedly been the focus of competition authorities around the world. In the USA, too, there have at times been considerations to forcibly spin off the advertising technology from the rest of the group, while in Europe the Digital Markets Act would also permit a demerger.
How the EU Commission would behave in this and other proceedings in the face of demands from US President Donald Trump and key members of Congress was recently unclear. But a reaction from Washington is unlikely to be long in coming. In her statement, EU Commission Vice-President Teresa Ribera attempts to take the wind out of the sails of the foreseeable response from the other side: She refers to a similar procedure in the USA – and is quite fundamental: “Our founding treaties, our laws and our fundamental values are not up for debate.”
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