Today, the European union has hit Google with a antitrust fine of €2.95 billion (£2.5 billion). This fine resulted from allegations that Google misused its monopolization in the advertising technology industry. This fine is a historic step by the EU to rein in the power of large tech companies. It comes from claims that Google has been guilty of “self-preferencing,” pushing its own advertising tech above that of its competitors.
The ad tech industry is at the heart of what ads are shown online and where they show up. Today’s decision by the EU Commission to slap this record fine of over $2.7 billion on the search behemoth comes after similar conclusions of Google’s anti-competitive behavior. Europe’s competition watchdog imposed a record-breaking fine of €4.34 billion (£3.9 billion) on the company in 2018. This enforcement action was taken for leveraging its Android OS to maintain and expand its monopoly.
Google has 60 days to propose initial changes to its practices. If it does not succeed in doing so, the Commission will move to direct the development of its own remedies to the problems identified. The increase in the fine reflects Google’s repeated violations of competition regulations, with Teresa Ribera, executive vice president of the Commission, stating, “In line with our usual practice, we increased Google’s fine since this is the third time Google breaks the rules of the game.”
In fact, Ribera was adamant about the need of great shifts. He proposed that the only way for Google to truly resolve its conflict of interest should involve a structural remedy, such as divesting part of its ad tech business. The Commission’s actions come amidst ongoing scrutiny of how US tech firms operate within the EU, with President Donald Trump frequently criticizing the bloc’s fines and enforcement actions against companies like Google.
Ribera went on to vigorously justify the Commission’s position. This action was taken despite pushback and alarmist fears from big tech executives over the potential effect of fines on European industry. “There’s nothing anti-competitive in providing services for ad buyers and sellers, and there are more alternatives to our services than ever before,” she asserted.
After the ruling, Lee-Anne Mulholland, Google’s global head of regulatory affairs, slammed the decision. She remarked, “It imposes an unjustified fine and requires changes that will hurt thousands of European businesses by making it harder for them to make money.”
The Commission strongly rebutted the articles alleging that it delayed release of Google’s fine. This dismissal is particularly notable and alarming given current historic, contentious trade relations between the EU and US. As this plays out, we remain hopeful that Google will address the Commission’s stipulations. That said, the ruling represents a major setback for its business practices going forward.