Google has suffered a $2.7 billion penalty from EU as almost a decade-long investigation from the European Commission comes to an end. Allegedly, Google has favored its own shopping services over the competition in its search results, thus abusing its market-leading position.
This will definitely make a negative impact on the already threatened relations between European regulators and Silicon Valley company. The impact is, however, groundbreaking, and now nothing can stop further investigations from the hands of EU.
The European Commission statement
Margarethe Vestager, European Union Competition Commissioner, stated that there's no doubt that Google has improved our lives with the constant improvement of its products and services. That is after all, what made the online shopping a pleasant experience. However, there is more to Google's strategy considering its shopping service than meets the eye.
According to Commissioner Vestager, Google has favored its own shopping service over the competition in its search results. She continued by stating the following, 'What Google has done is illegal under EU antitrust rules.' Commissioner Vestager also said that Google has denied other companies the right for competing under the rules of fair competition.
She goes on to suggest that the most important thing is that Google 'denied European consumers a genuine choice of services and the full benefits of innovation,' Margarethe Vestager concludes.
.@Google gave illegal advantage to own comparison shopping service by abusing its search dominance: It must stop & pay fine of €2,4 bn.
— Margrethe Vestager (@vestager) June 27, 2017
What it means for Google
Not only did Google suffered an enormous penalty, but the fine also exceeded expectations as it was twice as much as anyone ever thought it would be.
Now, Google is given the last warning to change its behavior within the course of 90 days. If they don't, they will be ordered by the European Commission to pay up to 5% of the daily turnover.
Just for the sake of mentioning, the global revenue of the Alphabet, Google's parent company, was $90 billion in 2016 alone.
Google complains?
Obviously, Google officials have an entirely different standpoint regarding this penalty from the EU. In the official email, the company stated that they 'respectfully disagree with the conclusions announced today' and they added that the company will carefully 'review the Commission's decision in detail.' In conclusion, the company's officials stated that they will "consider an appeal,''' Business Insider reported.
