Two billion, four hundred and twenty million euros. That is the amount of the colossal fine that on 27 June 2017 the European Commission decided to impose on internet giant Google, on the basis of two charges: abuse of dominant position and violation of the rules guaranteeing fair competition within the EU. But beyond the legal formulation, what, in concrete terms, was the American company found guilty of?

Google Shopping too prominent for EU authorities: "Consumers penalised"

Anyone who has carried out an online search with the aim of finding the best price for an item on sale online may have noticed that Google, as argued by the Brussels Commission, allegedly granted greater visibility to results relating to its own price-comparison service, known as Google Shopping. In other words, when entering the name of any product as a search term, the results returned would tend to favour the comparator owned by the company itself, unfairly pushing down the offers proposed by competitors (i.e. other comparators such as Trovaprezzi, Kelkoo or Twenga). And given that almost all internet users choose Google to conduct their online searches, the Commission concluded that a severe distortion had been created for consumers. Hence the record-breaking fine, well above the also historic penalty imposed on computer components manufacturer Intel in 2009, which was ordered to pay 1.06 billion euros.

Google Shopping multa — According to the European Commission, Google Shopping was unduly favoured over competitors by the search engine ©Kevork Djansezian/Getty Images

The offices of Competition Commissioner Margrethe Vestager had sent a formal statement of objections to the Californian giant more than two years earlier, on 15 April 2015. "Google," explained the member of the EU's executive body, "has launched many innovative products and services that have changed our lives. The effects are undoubtedly positive. But in the strategy it pursued for its comparison shopping service, it did not simply make its product better than those of its competitors in order to attract more customers: it abused its dominant position as a search engine to promote its own service in its search results and demote those of its rivals." This amounts to "illegal behaviour under European antitrust rules, because it prevented other companies from competing on their merits and from innovating. But, above all, it denied European consumers the ability to choose services freely."

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The EU fined Google $2.7bn on June 27th for favouring its own search content. We spoke with the EU's Commissioner for Competition in January

175 8 28 giu 2017 · Apri su X →

The company's defence: "Users want speed — we will appeal"

Originally, Google Shopping was called Froogle and worked as a conventional comparator, displaying the cheapest products available on the market prominently. The transformation dates back to 2012, when the advertising model already tested by the Californian giant with AdWords — the service that allows advertising space to be placed within the search engine's pages — was applied to the system.

Margrethe Vestager commissario Ue — European Competition Commissioner Margrethe Vestager ©Friends of Europe/Flickr

Google defended itself by explaining that "when you shop online, you want to find the products you're looking for quickly and easily. We present ads from tens of thousands of advertisers, large and small. That's why we disagree with the Commission's conclusions. We will review the decision in detail and we intend to appeal." In the meantime, the EU gave the search engine 90 days to change the way it presents results, should it wish to avoid even heavier penalties. All the more so given that the company is under scrutiny in two other European investigations: the first concerns AdSense, the software that "selects" the advertisements displayed on the pages we visit, tailoring them according to our interests, the type of sites we visit most frequently and therefore our (presumed) preferences. The second focuses instead on the Android smartphone operating system.

The risk of new tensions with the United States

Furthermore, the Brussels Commission's decision comes less than a year after the fine imposed on another American giant, Apple: in that case for having benefited from "undue tax advantages" through certain agreements concluded with Ireland. All of these decisions appear not to have been welcomed in Washington and could make relations between the United States and the European Union even more strained. The first repercussions could already emerge at the G20 summit scheduled in Hamburg, Germany, on 7 and 8 July.

Why Google was fined by the European Commission