Google fined another $1.7 billion

Google’s European fines are now up to $9.5 billion in the last three years.

European Union regulators have hit Google with a $1.68 billion (1.49 billion euro/£1.28billion) fine for or blocking rival online search advertisers. It is the third multi-billion dollar EU antitrust penalty for Google’s parenting company Alphabet in just two years. The European Commission, which said the fine accounted for 1.29 percent of Google’s turnover in 2018, said in a statement that the anti-competitive practices had lasted a decade.

The EU’s competition commissioner, Margrethe Vestager, announced the results of the long-running probe at a news conference in Brussels on Wednesday.

‘Today’s decision is about how Google abused its dominance to stop websites using brokers other than the AdSense platform,’ Vestager said.

The commission found that Google and its parent company, Alphabet, breached EU antitrust rules by imposing restrictive clauses in contracts with websites that used AdSense, preventing Google rivals from placing their ads on these sites.

Today’s EU case concerned AdSense for Search, which placed a Google search bar on the website in question, then used any searches made through it to tailor the content of adverts that users were shown.

For example, if a user searched for ‘shoes’, they would be shown articles about shoes as well as adverts for shoes. But Google also made publishers sign contracts which initially forbid them from using a rival search engine on the same site, and later forced them to make Google’s search the most prominent used on the site. Google also required publishers to reserve the most profitable advertising spaces for adverts they supplied, and forced them to seek written approval any time they wanted to change the way rival adverts were displayed

The EU found these restrictions stifled innovation and denied rivals the chance to compete.

Google ‘prevented its rivals from having a chance to innovate and to compete in the market on their merits,’ Vestager said.  ‘Advertisers and website owners, they had less choice and likely faced higher prices that would be passed on to consumers.’

Last year Vestager hit the company with a record $5bn (£3.8bn / €4.3bn) fine following an investigation into its Android operating system. In 2017, she slapped Google with a $2.84bn (£2.1bn / €2.42bn) fine in a case involving its online shopping search results.

I strongly suspect this is why YouTube appears to be much less inclined to interfere with European-based AdSense accounts than US-based ones. Given that the EU has been willing to fine Alphabet a cumulative $10 billion for interfering with rival corporations, imagine how high the fines for consumer actions could be.

The tech giants are under the mistaken impression that the contracts they impose on everyone that declare they can do anything they want at any time to anyone are going to hold up in court. As Indiegogo is already learning, that is absolutely not true; to the contrary, the mere fact that they blithely impose these “agreements” on everyone without any input from the other parties is actually one of the more powerful legal weapons against them.

What their lawyers don’t seem to have grasped is that the legacy terminology that was perfectly sufficient when a free service was provided does not supersede centuries of contract law precedent once money starts changing hands.