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EU Charges Spotlight Google’s Self-Dealing Power
Submitted by Scott Cleland on Fri, 2015-04-17 11:07
Facts belie Google’s rote denials that it is dominant, and that favoring its own content over competitors is anti-competitive in the EU. As this post will prove below, the public facts are overwhelming that Google is dominant and self-dealing.
But first, look closely and witness that the entirety of Google’s antitrust defense is essentially political -- that the EU’s antitrust law and precedent shouldn’t be different or tougher than America’s. Specifically, Google essentially is arguing that the EU shouldn’t have a lower market share threshold to be legally considered dominant and the EU shouldn’t have presumption in law that if dominant, the dominant company has “a special responsibility not to allow its conduct to impair competition on the common market.”
That’s wishful whining; it is not a legal antitrust defense in Europe.
It is only fitting that Google faces a Danish prosecutor in EC VP Margrethe Vestager. That’s because Google currently is acting out the role of emperor in the most famous Danish fable by Hans Christian Anderson, the “The Emperor’s New Clothes.”
The rote dominance denials of the Google PR-legal-plex may have Googlers convinced that anyone smart can see that the Google Emperor’s antitrust defense clothes are impregnable armor when any commoner can see the facts that the Google Emperor is actually wearing no EU antitrust defense clothes at all!
Google is, and should be, terrified that they have a rote and chauvinistic American antitrust defense, tailored exquisitely for American law, precedent and sensibilities. In Europe, it is an ill-conceived, ill-suited, and ill-mannered antitrust defense.
Watch in the coming months if Google acknowledges they are “not in Kansas anymore” where the rules have been bent to suit the fiber of Google’s being.
EC VP Margrethe Vestager is proving very shrewd. She understands that at core Google’s entire legal defenses are lame: first that Google’s >90% market share should not be considered dominant, and second that it should not be considered to be anti-competitive when it biases its shopping search results to self-deal.
The EU starts from a largely unassailable legal position in that it is EU law that says Google is wrong, not just the EC’s tough prosecutor. Next the EC prosecutor shrewdly has chosen to base the EC’s legal case on the rock solid foundation that Google search is dominant with >90% market share, and the copious public evidence that Google has knowingly allowed “its conduct to impair competition on the common market” in the search shopping vertical. Finally, the EC is well-aware of the statistical evidence of Google’s dominance compiled below.
Given that Google claims decisions should be data-driven, let’s consider the public data that Google is dominant and that its dominance is obviously proliferating beyond search.
First, consider how many Google web platforms rank #1 in the world.
Second, consider how many ways Google is #1 in digital advertising in the world.
Third, consider how many ways Google-Android’s mobile offerings are #1 in the world.
Fourth, consider the ways Google-YouTube ranks #1 in the world in digital video distribution.
Finally, consider the ways Google-Maps ranks #1 in the world in digital mapping services.
In short, Google has a huge antitrust liability problem in Europe and they appear to be in deep dominance denial.
Apparently the infamous Google PR-legal-plex assumes that the EC can be bullied politically like the FTC into believing the global narrative that Google clothes itself in, that Google is not dominant and has done nothing wrong with its search market dominance, period full stop.
However, anyone that takes just a little time to familiarize themselves with Google’s fairy tale defense, and the facts of this case, can discern that Google’s search dominance in Europe is nearly incontrovertible and that Google has rapidly proliferated its search dominance into multiple, adjacent, strategically-important and necessary products and services.
Simply, Google is fantasizing that it should not be subject to, or held accountable to, EU antitrust law.
(Note: if one wants more evidence and statistics that Google is dominant in search and is rapidly proliferating its search dominance into many adjacent digital products and services please see Googleopoly.net and specifically Googleopoly XIV: Google’s WorldWideWatch over the WorldWideWeb: Charting Google’s Internet Empire & Data Hegemony.)
Scott Cleland is President of Precursor LLC, a consultancy serving Fortune 500 clients, some of which are Google competitors. He is also author of “Search & Destroy: Why You Can’t Trust Google Inc. Cleland has testified before both the Senate and House antitrust subcommittees on Google and also before the relevant House oversight subcommittee on Google’s privacy problems.