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Responses To Google’s Tentative Settlement With the European Commission

On 5 February 2014, the European Commission tentatively accepted Google’s revised proposal of commitments to end the Commission’s antitrust investigation into concerns that Google is illegally abusing its dominant position in online search and search advertising.

The Commission rejected Google’s first two proposals as insufficient following market tests and reviews that elicited widespread criticism from consumer advocates, business groups, and complainants.

Many of those same concerned parties have called for greater transparency from the Commission, which has not released the full details of Google’s proposal, and broad consultation in evaluating Google’s latest offer. The Commission has said it only plans to collect feedback from the 18 complainants before making a final decision to accept Google’s proposed commitments and make them legally binding to close the investigation.

The following are excerpts of responses to the tentative settlement with links to the sources or full text of their comments:

FairSearch

15 February 2014

“Market Tests are still necessary to demonstrate the effectiveness of Google’s proposed commitments released today by the company. We are examining the offer now, and will comment when we have reviewed it. We welcome Google’s unilateral decision to publish a non-confidential version of its commitments, but will continue to stress the importance of market testing to demonstrate the effectiveness of these commitments to restore competition to search.”

FairSearch

Link to source

12 February 2014

“The proposal has not been made public, but from what has been reported it appears that this solution may be worse for consumers and competitors than doing nothing at all… FairSearch urges the Commission not to accept Google’s third proposal on good faith, but to make it public so that it can be subjected to testing which will reveal its actual effects on the market, competitors and consumers.”

Legal Counsel Thomas Vinje

Link to source

5 February 2014

“The European Commission has tentatively accepted a proposal by Google which is worse than doing nothing… The Google proposal requires rivals to pay Google for placement similar to that of Google’s own material, undercutting the ability of other to compete and provide consumer choice. This will be done through an auction mechanism that requires participating companies to hand the vast majority of their profits to Google.”

Legal Counsel Thomas Vinje

Link to source

Allegro Group

5 February 2014

“We are very disappointed with the announcement made in the competition case against Google as the solution proposed does not address the fundamental issue of ensuring a level playing field for the European Internet economy.

“We extensively tested user interface solutions similar to the ones presented by the Commissioner today in the Autumn of 2013, and results clearly showed that they do not address the unfair competition issue. They fix Google’s market share in a new segment at no cost to its business and requires rivals to pay for access of a far smaller share of the market.”

Chris Sherwood, Head of Public Policy

Link to source

BEUC – The European Consumer Organisation

5 February 2014

“The Commission has today fallen far short of the aim of ensuring fair consumer choice in relation to online search in Europe. Consumers should be able to expect neutral search results. This is not a reality today due to the nature of Google’s business model and we expected the Commission to remedy this.”

“After several years of work, this is a deeply disappointing conclusion to the process. It would appear to have tripped over itself in a rush to a summer political deadline.

“The settlement has been concluded largely behind closed doors, and we are disheartened to hear today that the EU will not seek feedback from parties formally interested in the investigation.

“Consumers being the Davids to the Google Goliath, their views could have been listened to much more closely by the antitrust investigators… The Commission has emerged from a legal maze and brought consumers into a room of smoke and mirrors. After 3 years, the stated destination of countering abuse of a dominant market position has not been reached.”

Monique Goyens, Director-General

Link to source

Consumer Watchdog

5 February 2014

“In addition to our deep concerns about the procedure that is being followed in apparent contradiction to Commission policy, we have strong objections to this third proposal from the Internet giant on its merits in so far as we have been able to determine the details of what Google is offering.  At a minimum any remedy must insist that Google use an objective, nondiscriminatory mechanism to rank and display all search results – including links to Google products.

“The deal as outlined by Almunia bizarrely not only allows Google to profit from the traffic it diverts from competitors, but also from the new possibilities to charge for their inclusion among the rival links listings. The deal as outlined would give Google more power over competitors than is now the case, ultimately limiting consumer choice and driving prices higher. The deal as outlined would give Google more power over competitors than is now the case, ultimately limiting consumer choice and driving prices higher.”

John Simpson, Director of CW Privacy Project

Link to source

European Magazine Media Association (EMMA)

5 February 2014

“It is essential for the legacy of the Barroso II Commission that this case seriously considers the economic impact on European businesses, including our sector. We have continuously criticised the lack of acceptable solutions proposed by Google’s commitments, which would even increase the level of infringement of EU competition rules and therefore further entrench Google’s abuse of its dominant position on the European digital market.”

David Hanger, President

Link to source

European Newspaper Publishers Association (ENPA)

5 February 2014

“If the Commission were to endorse Google’s anti-competitive behavior of Google, it would be a devastating blow to the future development and sustainability not only of the independent press sector, but European creative industries as a whole. Legitimizing Google’s practices would seriously threaten Europe’s core democratic values, such as press freedom, media pluralism and consumer access to information.”

Ivar Rusda, President

Link to source

European Publishers Council

7 February 2014

“Although far from final, the decision to proceed on the basis set out today is fundamentally defective. Nothing announced today deals with the original abusive practices identified by the Commission. The latest changes offered by Google are trivial and EPC and others have already provided solid evidence that shows how they are ineffective. We are raising our concerns about the process and implications of such a package directly with the members of the European Commission before a final decision is taken.”

Executive Director Angela Mills Wade

“The Commission is side-stepping our concerns about the way an abusive monopolist is dictating licensing terms. A take it or leave it opt-out rather than the means to agree terms of access to our content is the ultimate predatory practice.”

Chairman Francisco Pinto Balsemão

Link to source

Foundem

5 February 2014

“Google, not its rivals, would be the main beneficiary of any profits derived from these links. Moreover, in a further devastating blow to consumers, the pay-for-placement elements of these proposals remove the last vestige of merit – or relevance-based placement for commercial verticals. Given Google’s overwhelming dominance of search and search advertising, these practices have a devastating impact on competition, consumer choice, and innovation wherever Google deploys them.”

Foundem Statement

ICOMP – Initiative for a Competitive Online Marketplace

5 February 2014

“A settlement without third party review is a massive failure. Complaints and others must see Google’s proposed commitments, not just the Commission’s analysis of why they will work. Hard data from market tests proved that the previous settlement would not work – we need time and opportunity to ensure full technical assessment of how effective the proposed remedies would be.”

David Wood, Legal Counsel

Link to source

Microsoft

5 February 2014

“Market testing of Google’s last two proposals identified serious and widespread concerns about the damage they would have done. If these new proposals are materially better than those that have already been rejected then they should be broadly market tested.”

Brad Smith, General Counsel 

Link to source