Google responds to antitrust investigations opened by EC

As has been long mooted, the European Commission has officially announced a Statement of Objections against Google on its comparison shopping service, while also opening a separate formal investigation on Android. Google, predictably, has come out with its view of the matter.

The Commission reckons Google has abused its dominant market position with regards to general internet search services in Europe, specifically when it comes to favouring its own comparison shopping products on search results. This, the EC says, is in violation of European antitrust regulations, subsequently harming European consumers and stifling competition in the sector.

In several instances the Commission appears to have been having a bit of fun with Google investigations, after apparently considering action to force the OTT player into regional and functional unbundling late last year. Margrethe Vestager, the EU Commissioner in charge of competition policy, is concerned about Google abusing its dominant market position.

“The Commission’s objective is to apply EU antitrust rules to ensure that companies operating in Europe, wherever they may be based, do not artificially deny European consumers as wide a choice as possible or stifle innovation,” she said. “In the case of Google I am concerned that the company has given an unfair advantage to its own comparison shopping service, in breach of EU antitrust rules. Google now has the opportunity to convince the Commission to the contrary. However, if the investigation confirmed our concerns, Google would have to face the legal consequences and change the way it does business in Europe.”

A statement from the EC said the preliminary conclusion of the investigation it opened in November 2010 determined that Google prioritises its own shopping product in its search results over competing products.

Separately, the Commission is also investigating Google on account of its proprietary apps being pre-loaded onto mobile devices and tablets running Android.

The bone of contention relates to the fact that Android, although owned by Google, is open-source. It may turn out that the agreements it has entered into with manufacturers, to have proprietary Google wares pre-loaded onto Android devices, is in breach of antitrust regulations.

Speaking about the separate Android case, Vestager reckons anticompetitive action by Google is threatening the development of the mobile market in Europe, and harming the end user.

“I have also launched a formal antitrust investigation of Google’s conduct concerning mobile operating systems, apps and services,” she said. “Smartphones, tablets and similar devices play an increasing role in many people’s daily lives and I want to make sure the markets in this area can flourish without anticompetitive constraints imposed by any company.”

Google’s Hiroshi Lockheimer, VP of Engineering for Android, responded to the announcement from the EC by posting about the positive impact Android is having the world over, on Google’s blog page.

“The European Commission has asked questions about our partner agreements,” he said. “It’s important to remember that these are voluntary – again, you can use Android without Google – but provide real benefits to Android users, developers and the broader ecosystem.

“We are thankful for Android’s success and we understand that with success comes scrutiny,” he said. “But it’s not just Google that has benefited from Android’s success.  The Android model has let manufacturers compete on their unique innovations.  Developers can reach huge audiences and build strong businesses.  And consumers now have unprecedented choice at ever-lower prices.  We look forward to discussing these issues in more detail with the European Commission over the months ahead.”

It seems that Google is more than ready to roll up its sleeves and get into the thick of it with the Commission on this one.