Posted on June 27, 2017 by staff

Google hit with £2.1bn fine over ‘illegal’ shopping results


Google has been hit with a record €2.4bn (£2.1bn) fine from the European Commission after it was ruled to have illegally-favoured its own shopping channels.

It was found the web giant had abused its power by promoting itself, and distorting the market, through its search results.

Google has also been ordered to end anti-competitive practices within 90 days or face a further penalty.

The European Union’s competition commissioner Margrethe Vestager said: “What Google has done is illegal under EU antitrust rules.

“It has denied other companies the chance to compete on their merits and to innovate, and most importantly it has denied European consumers the benefits of competition, genuine choice and innovation.”

The US-based firm previously argued the likes of Amazon and eBay had more sway over public spending habits.

“When you shop online, you want to find the products you’re looking for quickly and easily,” a Google spokesman said in response to the ruling.

“And advertisers want to promote those same products. That’s why Google shows shopping ads, connecting our users with thousands of advertisers, large and small, in ways that are useful for both.

“We respectfully disagree with the conclusions announced today. We will review the Commission’s decision in detail as we consider an appeal, and we look forward to continuing to make our case.”

The commission has the power to fine Alphabet – Google’s parent company – up to 10 per cent of its annual revenue, which was more than $90bn (£70.8bn) last year.

Kerry Rice, an analyst at Needham & Co, said: “Shopping is important because it adds to search. It’s not just a link; you get more visibility on what you’re going to click on.

“If it’s not at the top of search results it probably loses value because Google may not be able to charge as much for these ads.”

The European Commission’s decision could set a precedent that determines how the EU’s civil service handles related complaints about the prominence Google gives to its own maps, flight price results and local business listings within its search tools.

It has been investigating Google Shopping since late 2010.