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| Google and the dull artillery of EU antitrust litigation | Google and the dull artillery of EU antitrust litigation |
| (about 1 hour later) | |
| The halls of diplomacy cultivate a special kind of patience. In conference rooms and annexes, idealism doesn’t so much burn out as diffuse – splintered by endless meetings and dull documents. “We hoped for more,” younger selves cry. “But we were doomed to cooperate.” | The halls of diplomacy cultivate a special kind of patience. In conference rooms and annexes, idealism doesn’t so much burn out as diffuse – splintered by endless meetings and dull documents. “We hoped for more,” younger selves cry. “But we were doomed to cooperate.” |
| One of Brussels’ cooperation efforts that has been running the longest is the European antitrust case against Google. Complaints that Google prioritises its own services in manipulating search results, abusing its dominant position over 90% of the search market, started rumbling eight years ago and were formalised in 2009. The European commission opened an inquiry, and 20 organisations added complaints, ranging across Google’s methods of modifying search, scraping content, slicing advertising, and making exclusive data deals. | |
| After five painful years, punctuated by three controversial, failed settlement attempts between Google and former competition chief Joaquín Almunia, the case shifted up a gear this April. Almunia’s straight-shooting replacement, Margrethe Vestager, issued Google with a formal notice, termed a “statement of objection”. Deliberately shedding Brussels’ laggardly image, Vestager zeroed in on the best, narrowest case she could find: that Google uses its dominance in search to promote its own services in Google Shopping, diminishing the visibility of potentially cheaper results to consumers. She gave Google 10 weeks to respond. | After five painful years, punctuated by three controversial, failed settlement attempts between Google and former competition chief Joaquín Almunia, the case shifted up a gear this April. Almunia’s straight-shooting replacement, Margrethe Vestager, issued Google with a formal notice, termed a “statement of objection”. Deliberately shedding Brussels’ laggardly image, Vestager zeroed in on the best, narrowest case she could find: that Google uses its dominance in search to promote its own services in Google Shopping, diminishing the visibility of potentially cheaper results to consumers. She gave Google 10 weeks to respond. |
| Those 10 weeks have now passed. Where are we now, and where are we going? | Those 10 weeks have now passed. Where are we now, and where are we going? |
| Deadline already extended | Deadline already extended |
| Speaking on the would-be deadline of 24 June, Vestager confirmed that the 10 week cut off had already been extended by a fortnight, since Google had not received all the documents. And do not expect any announcements or official reveals soon. Further time extensions are likely. And even then, the official details of the charges, evidence and responses will remain top-secret, limited to the immediate parties to the case. Leaks are expected, but nobody wants to be the first to move. | Speaking on the would-be deadline of 24 June, Vestager confirmed that the 10 week cut off had already been extended by a fortnight, since Google had not received all the documents. And do not expect any announcements or official reveals soon. Further time extensions are likely. And even then, the official details of the charges, evidence and responses will remain top-secret, limited to the immediate parties to the case. Leaks are expected, but nobody wants to be the first to move. |
| Starting a week ago, the complainants started receiving copies of the statement of objection. They will respond over the coming month. The expectation is that, by the end of July, the commission will have all the documents it needs. Over summer, junior competition lawyers will sort out the finer details of the case. Google can choose whether to go through a hearing, which will give complainants further opportunities to present their case as well as to hear Google. Google will critique the methodology, claim that its products have moved on, and continue to point to the flourishing competitive environment in which it operates. But by the end of the year, we are likely to have a decision. | Starting a week ago, the complainants started receiving copies of the statement of objection. They will respond over the coming month. The expectation is that, by the end of July, the commission will have all the documents it needs. Over summer, junior competition lawyers will sort out the finer details of the case. Google can choose whether to go through a hearing, which will give complainants further opportunities to present their case as well as to hear Google. Google will critique the methodology, claim that its products have moved on, and continue to point to the flourishing competitive environment in which it operates. But by the end of the year, we are likely to have a decision. |
| Where are we going | Where are we going |
| It is important to keep the entire European investigation in perspective. Vestager has two priorities. The first is to set a precedent, which complainants can then take to national courts and try their hand fighting over the search verticals of maps, flights, holidays, etc. The second is to get Google to take action itself. She hopes this will happen by imposing a fine that could have a “deterrent effect”. Then she wants the Google file off her desk. | It is important to keep the entire European investigation in perspective. Vestager has two priorities. The first is to set a precedent, which complainants can then take to national courts and try their hand fighting over the search verticals of maps, flights, holidays, etc. The second is to get Google to take action itself. She hopes this will happen by imposing a fine that could have a “deterrent effect”. Then she wants the Google file off her desk. |
| This makes the commission’s case rather miniscule in the wider scheme for competitors and consumers. The case will shed no light on Google’s scraping and consolidation of data, nor its role in manipulating advertising markets. This is partly because Vestager, shaking up Brussels’ patient environment, has chosen a narrow and targeted action, rather than robust and visionary change. But more fundamentally, it’s because competition law is ill-equipped to deal with monopolies of the digital age. | This makes the commission’s case rather miniscule in the wider scheme for competitors and consumers. The case will shed no light on Google’s scraping and consolidation of data, nor its role in manipulating advertising markets. This is partly because Vestager, shaking up Brussels’ patient environment, has chosen a narrow and targeted action, rather than robust and visionary change. But more fundamentally, it’s because competition law is ill-equipped to deal with monopolies of the digital age. |
| Google dominates search. It consolidates more data – more maps over the territory of knowledge – than any other online player. But dominance, and consolidation of data sets, are not what competition law cares about. What matters for competition is, increasingly, “effects” – whether business practices lead to the foreclosure or flight from the market of equally efficient competitors. Economics here don’t tell the full story of Google’s effect on the digital landscape, and of the concerns that could, and should, animate regulators and the public. If the law did capture those concerns, it would be as rigorous in looking at the damaging effects of vertical integration, as it is in looking at horizontal collusion. Without this, Google’s monopoly, self-reinforcing through the flow of data that only it can access and exploit, remains untouchable, and the world is doomed to cooperate. | Google dominates search. It consolidates more data – more maps over the territory of knowledge – than any other online player. But dominance, and consolidation of data sets, are not what competition law cares about. What matters for competition is, increasingly, “effects” – whether business practices lead to the foreclosure or flight from the market of equally efficient competitors. Economics here don’t tell the full story of Google’s effect on the digital landscape, and of the concerns that could, and should, animate regulators and the public. If the law did capture those concerns, it would be as rigorous in looking at the damaging effects of vertical integration, as it is in looking at horizontal collusion. Without this, Google’s monopoly, self-reinforcing through the flow of data that only it can access and exploit, remains untouchable, and the world is doomed to cooperate. |
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