Google May Have Struck an Antitrust Deal in Europe

Google Chief Executive Officer Larry Page Photograph by Jeff Chiu/AP Photo

Three and a half years after European competition regulators first started poking around Google’s search business, a deal is in sight—that is, if the companies whose complaints kicked this all off, Microsoft included, don’t find loopholes in Google’s latest settlement proposals.

That, after all, is what appears to have happened with proposals Google made in April. The European Commission nixed those concessions in July, after the company’s rivals turned them down, but Google came back with tighter concessions. This time, the Commission seems to think they might work. (Remember, Google has a 90 percent share of the European search market vs. around two-thirds of the U.S. market.)

On Tuesday, Competition Commissioner Joaquin Almunia outlined Google’s latest proposals for fixing the Commission’s four specific concerns. which are:

• In its results, Google promotes its own services without this being clear to the user. Industry-specific vertical search outfits see their services downgraded in Google’s results, sometimes not appearing on the first page.

• Google scrapes content from third-party vertical search rivals without their permission.

• Google bans publishers that use its advertising from displaying search ads from Google competitors on their websites.

• Google’s contracts forbid advertisers from porting their campaigns to rival search ad platforms.

In the case of the last two concerns, little has changed from Google’s earlier settlement proposals (which amounted to “We will stop doing this”) other than the addition of further safeguards against what Almunia called “possible circumventions.” This suggests Microsoft and Google rivals found potential loopholes that have now been sewn up.

Regarding the EC’s first concern, Almunia said the new proposals set aside “a larger space of the Google search result page” for results coming from those vertical rivals. The rivals will also get to put their logos next to those results. In a boost to smaller specialized search operators, Google’s ad auctions will also allow bids for specific queries.

As for Google’s scraping of content, the company had previously offered an opt-out for those who didn’t want their content to be hoovered up and regurgitated. That opt-out has become more granular, and there are tighter provisions to make sure Google can’t “retaliate” against those who choose to use it.

In addition to all this, the new proposals include an “independent monitoring trustee” to make sure Google is doing what it promised to do.

Almunia stressed that the new proposals will relate to both typed and spoken queries on both desktop and mobile devices, suggesting there might be an impact on Google Now, as well as on traditional search results.

Europe’s competition chief indicated that he thought the new proposals were an improvement and pointed out that his team was negotiating further improvements with Google until Monday. Here’s what Almunia said about the path forward:

“As a next step, I will seek feedback on the improved commitments proposal from complainants and other relevant market participants. To that end, we will send information requests … on the improvements that are being proposed.

“We know the general positions of the complainants and other stakeholders. What we need now is to receive concrete technical elements on the effectiveness of the proposed package in order to conclude whether this new proposal is satisfactory from a competition point of view.”

If there are no serious objections, the settlement will probably be set in stone in spring 2014. If the new proposals fail to make the grade, the sorry saga will continue, with Google looking at bans, fines, and other nastiness it would no doubt rather avoid.

Bear in mind that this is only one of three EU antitrust probes in which Google is involved. There’s also the Motorola standards-essential patents case (“The investigation is well-advanced,” Almunia said) and a preliminary stage investigation of Android. Google’s European counsels and Almunia’s staff will have plenty to discuss over the coming month—and perhaps years—whether they reach a settlement over search.

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