Google Inc. (NASDAQ:GOOGL) finds itself in a very uncomfortable position in the EU. There are serious charges being contemplated by the EU against the search major. The root cause for this outrage and long list of “objections” being expressed is the fact that the search results shown by Google seem to “preferentially” place Google’s own products and services on top and competitors are relegated after them.
The VOX feels that, at face value, this looks minor, but if we were to study the deep impact and possible implications are far-fetching and may potentially result in a radical change in the way Google works. The current issue seems to be centered around online shopping. Activists and competitors are claiming that Google shopping gets preferential positioning on top when you search for anything. Although that seems to be true and the competitors are justified, there are other factors that we need to consider here. The main issue is that Google doesn’t just put Google shopping on top of the search. It systematically does it for its other products like Google Images, Google Maps, and Google News — by putting them up in neat little boxes near the top of Google search results.
Hence, it should logically follow that if you take the logic of the EC’s complaint, then EU regulators are just scratching the surface of the issue. If it’s illegal to elevate Google Shopping over other search results, it should also be illegal to give preferential treatment or positioning to Google’s other specialized search products for maps, news, or images.
This aspect of interpretation is what Google’s more ambitious critics are pushing for. If they get the final say, it could mean that we will see a drastic transformation of Google’s search product — one that may not be in the interests of customers – us!
For the customer, the average Joe who searches using Google, the problem is more fundamental: getting regulators involved in designing search results could potentially result in “tainted google results” as the whole logic will get overhauled and will be seen as counter-innovative. Google’s practice of including results from its other products in search results pages might be bad for competitors, but it’s definitely convenient for many users like you and me.
The European Commission clearly says that “Google systematically positions and prominently displays its comparison shopping service in its general search results pages, irrespective of its merits,” and that this has been happening since 2008. This is similar to what American and European regulators said against Microsoft in previous decades.
All of us remember the legendary legal tussles that Microsoft faced at its peak for bundling IE and it’s own media player with Windows that potentially killed competition and basically promoted their wares to a HUGE customer base that Windows commanded. Eventually, they lost the battle and were forced to unbundle their stuff from windows. While the media went gaga over the verdict, the number of unbundled copies sold was a minor fraction of the bundled ones and even that roll-out was delayed by a year. So it is not like Microsoft was hurt badly!
So why is the EC looking only at shopping in this seemingly deeper issue, while mostly ignoring the bigger issue involving other Google products? Mark Patterson, a legal scholar at Fordham University, believes European regulators probably focused on shopping because they “have what they think is a smoking gun” — though Patterson says we don’t yet know what that is. It would follow that, if the EC has data as evidence that Google chose to promote its own shopping products and the EU internal data showed customers leaned towards results from third parties, then that could be a justifiable and feasible basis for legal action.
Another seemingly important reason for the focus on shopping is the fact that a European shopping site, Foundem, has been a leading reason for EU officials to take action against Google. Google has removed Foundem from their search results and after a long battle of 9 years, they were restored. Foundem has since then been at the helm of the Anti-Goole lobby in Europe.
Technically, it is possible to enforce a regulation and make Google display competitors’ results in place of Google’s own results. But from an end users’ perspective, the increased bureaucracy could deter Google from making beneficial improvements to its search results page altogether.
There are questions about Net Neutrality that also become relevant here, isn’t what Google is doing in violation of neutrality norms? Aren’t they trying to influence end users into going to their products or sites by default? From that aspect, it looks like a violation, but then as users we are used to this behavior by Google search, so what is right here? If we go by written words, it is wrong.
In summary, what Google is doing is clearly wrong and has to be changed. Complications like Neutrality and the broader implications outside the domain of shopping make this legal tussle very relevant and important. Whatever the outcome, it will definitely change the way we search the web and consume search results. We need to track this development closely as it affects all of us in some way or the other.