The search-engine giant bows to pressure from the European Commission
MOST users will not notice the difference. Starting today, Google is fully implementing a small but important change to the advertisement box at the top of the results pages in Europe. Previously the slots in “Google Shopping”, as this box is called, were reserved for the firm’s ads and would only link directly to pages offering a particular product. Now some of the slots will be filled by rival comparison-shopping services and will include links to their sites. The reason is that they have been auctioned off, with Google as just one among the bidders. Why did the firm make these changes?
The auction is how Google hopes to comply with the European Union’s antitrust ruling against the firm in late June, which included a hefty fine of €2.4bn ($2.7bn). The European Commission held that the world’s biggest search engine had abused its dominance by discriminating against rival comparison-shopping services. And the commission required Google to start treating these in the same way as its own offerings. Selling the advertising slots to the highest bidder seems to be the fairest way of achieving this.
But whether an auction actually does the job is controversial. Some of the companies that brought the case, such as Foundem, a now dormant British comparison-shopping site, have already said that an auction will not guarantee equal treatment and is just a new source of revenue for Google. The fear is that rivals will be compelled to hand over most of the profits to the online giant. Instead, they argue, the ad slots in Google Shopping should be filled by an algorithm picking the most relevant offers—in much the same way as the firm selects its regular search results. Google counters that even the commission has no problems with charging for ad placements: it just wants equal treatment.
The commission will not decide immediately whether the changes amount to equal treatment, but will watch their impact closely—and issue another charge-sheet (“statement of objections”) if it is not satisfied. At any rate, Google has already appealed against the ruling made in June. Europe’s online shoppers should settle in for the spectacle of more years of legal wrangling—and more changes to the results page.
The auction is how Google hopes to comply with the European Union’s antitrust ruling against the firm in late June, which included a hefty fine of €2.4bn ($2.7bn). The European Commission held that the world’s biggest search engine had abused its dominance by discriminating against rival comparison-shopping services. And the commission required Google to start treating these in the same way as its own offerings. Selling the advertising slots to the highest bidder seems to be the fairest way of achieving this.
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The commission will not decide immediately whether the changes amount to equal treatment, but will watch their impact closely—and issue another charge-sheet (“statement of objections”) if it is not satisfied. At any rate, Google has already appealed against the ruling made in June. Europe’s online shoppers should settle in for the spectacle of more years of legal wrangling—and more changes to the results page.
