The ruling is significant as it impacts the very ethos of Google’s online search strategy, and any changes here could impact the company prospects as well.
Google is staring down at huge $2.7 billion fine after the EU anti-trust regulators ruled against the Mountain View company, charging it of altering its online searches in a manner that favored its own products or services.
Among the other charges, Google has been accused of include favoring its own online search ad at the expense of those of its rivals. Google has an overwhelming dominance in online search in Europe, enjoying over 90 percent share of the market.
The fine would still seem puny compared to the over $90 billion that Google’s annual revenue stands at. Still, the ruling will be a major setback for the company as it could directly impact the way it functions. Online search is among the most prominent of Google’s services and the ruling could lead to introducing significant changes to its otherwise closely guarded search algorithm.
Google’s trouble could, in fact, be far bigger than this as the company is also charged with favoring its own Android platform over those of the rivals. That Android happens to be one of the biggest mobile platform currently in use (the other being iOS of course) will only mean any adverse ruling against it would have wider ramifications than perhaps can be conceived.
The fine amount of 2.4 billion euros, which comes roughly to around $2.7 billion is the highest the European Union has ever fined a single company on issues regarding anti-trust. That infamous record has so far been held by Intel when it was fined 1.09 billion euros back in 2009.
As things stand at the moment, Google will have a three month period to introduce changes in the way it shows search results without favoring its own products. Failing to comply with this will attract a further fine of 5 percent of parent company Alphabet’s daily global turnover. That again comes to a sizeable $12 million a day given the $90.6 billion turnover Alphabet recorded in 2016.
Apart from that, another undesirable scenario Google could be facing is to open up its search algorithms for scrutiny by experts to ensure those are in accordance with the law. In the end, what the Commission wishes to enforce is that user’ search results should yield what they want instead of what Google wants.
Google responded saying the ruling does not reflect the truth and are considering filing an appeal after they have gone through the decision in detail. It also justified its search strategy claiming it to be in line with the basic consumer preference to have their search lead to the actual product they are looking for without landing in another page in the middle that would only prolong their search.
The present ruling can be seen as the culmination of a case that started 7 years ago. However, it seems far from over as the ruling impacts the basic foundation of Google’s search operations, and an appeal is almost imminent.