Google Inc (GOOG) avoids fine from the European Union

Posted Feb 5, 2014

Google Inc (NASDAQ:GOOG) has agreed to make concessions on how they display links from their competitors to avoid a fine from the European Union. This ends a three-year antitrust probe. By reorganizing the links, Google avoided a fine of up to $5 billion. This is 10% of their 2012 revenues. Google has to stick to this deal for the next 5 years.

Google may be investigated a second time by the European Union regarding the Android operating system for smartphones. Google has been scrutinized since November 2010 and received over a dozen complaints from companies (including Microsoft) for promoting their own services.

Google made a couple of attempts to fix the issue, but that did not work out. The Competition Commissioner Joaquin Almunia said on Wednesday that he will accept Google’s concessions without consulting the companies that filed a complaint.

This decision was obviously controversial. German online mapping company Euro-Cities said that they are going to file a grievance with the courts.

“Today’s announcement still leaves many questions open. We will continue to take legal action about Google’s business practices in the German and, if necessary, EU courts,” stated Euro-Cities CEO Hans Biermann.

So what changes are Google going to make? Google will let three rivals display their logos and web links in a prominent box and content providers will be able to decide what material Google can use for their own services. Google is also going to cancel restrictions that prevents advertisers from moving their campaigns to rival platforms like Yahoo! search and Microsoft Bing in Europe.

In regards to the potential Android investigation, FairSearch is accusing Google of using Android to send traffic to their search engine. FairSearch’s members include Microsoft and Nokia.

[Source: Reuters]