Google has been hit with a record-breaking €2.42 billion ($2.7 billion) fine by the European Union for breaking antitrust law. The decision follows a seven-year investigation into the US company’s search algorithms, which ended with the judgement that Google had “abused its dominant position by systematically favoring” its own shopping comparison service. Today’s fine is the largest antitrust judgement handed out by the executive body of the EU, the European Commission, topping a €1 billion penalty given to Intel in 2009.
“What Google has done is illegal.”
The primary target of the case is Google Shopping, a price comparison feature built into the company’s search engine. The commission’s antitrust filing states that Google showed users results from Google Shopping “irrespective of [their] merits,” depriving rival price comparison sites of traffic. The EU argues that because Google is so overwhelmingly dominant in Europe, it should not be allowed to actively undermine competitors.
As part of today’s decision, Google will have to change how its search algorithm ranks websites, in order to “comply with the simple principle of giving equal treatment to rival comparison shopping services and its own service.” This is a major imposition that Google will not take lightly. If it does not end its current conduct, the EU says the company faces daily penalties of up to five percent of its average daily turnover.
In a press statement, EU competition commissioner Margrethe Vestager praised Google for coming up with “many innovative products and services that have made a difference to our lives.” But added that the company also “abused its market dominance as a search engine by promoting its own comparison shopping service in its search results, and demoting those of competitors.”