After receiving numerous complaints from various credible entities, the parliament of Europe decided to vote in agreement of the motion which asked for the split of Google into two entities, one containing the Google Inc. (NASDAQ:GOOG) Search Engine and the other all of the rest of Google’s products.
The motion was raised in the European Parliament as it was alleged that Google’s search engine is designed to favor Google’s own services and products in its search engine results. Also, it was alleged in multiple complaints that Google advertisements use unethical means to favor its business.
Google currently dominates the market, as far as its search engine is concerned. It is especially dominant in Europe, a market where it enjoys over 90% share of the market. Seeing its unwavering dominance, rivals of Google raised questions regarding Google’s allegedly unethical practices, which they claimed it used to favor its own services, such as Google Play Store, Google Books, among many other.
Even though political organizations exercise no power over private entities such as Google Inc., this vote will definitely have an impact on Google’s freedom in the European market. Many analysts are predicting the vote will allow regulators of the internet inside Europe to exercise greater influence on the technology giant.
The vote itself has received mixed reviews. It has been praised by Google’s rivals such as Ask and AltaVista, and also by many industry critics and analysts. However, both the US politicians as well as the trade bodies present there have raised concerns over the decision, calling the decision an attack on the private entity and a barrier to its freedom in the European market.
After the vote by the European Parliament, it is now up to the European Union’s commissioner of competition, Margrethe Vestager, to decide the final position of the case. Vestager has been overlooking the case since 2010, when it was first handed to her, hence all the involved parties wait eagerly for her decision, which is expected to be released soon.
Vestager is not the first commissioner to handle this particular case. Before her, Joaquin Almunia tried the case with all the evidence that was available with him. Google had offered many peace offerings to its rivals under such proceedings, all of which were ultimately rejected by Almunia as “insufficient”. Hence, Almunia had ultimately decided to fine Google, as much evidence went against it, which was never decreed.
If Vestager however agrees to the vote then Google Inc. (NASDAQ:GOOGL) could be looking at an at least $5 billion in fine, no less.
Vestager’s history suggests a more lenient approach to the matter. According to analysts, she has never broken up a private entity in her entire career, and hence, a break-up of Google is an unlikely decision from her.
The European Parliament motion was raised by a German Democrat and a Spanish liberal, both of whom stated the best possible resolution of the dispute was the split of Google’s services. They argued, in principle, this would even-out the battlefield for all search engine services in existence, and allow for competition that is based solely on merit.