Benjamin Franklin, notable for successfully rebelling against a king and flying kites into thunderstorms, once said, “There never was a good knife made of bad steel.” He knew that the substance of things matters if they are to function as intended. Europe’s Digital Markets Act is a knife pointed at the heart of Google and other big tech companies who have already been found guilty and fined for crushing competitors in their respective markets. But its steel, its legal substance, is in danger of being fatally weakened by the flawed Google Shopping remedy.
In 2017 Google was fined €2.4bn for abusing its search engine dominance to crush competitors in shopping price comparison. Google appealed and the European General Court largely dismissed Google's action against the decision on 10th November 2021. The huge fine and Google’s own name recognition have guaranteed the appeal some headlines but in many ways it is a sideshow to what really matters, which is stopping Google from repeating its behaviour in the future and protecting European consumers.
WATCH THE VIDEO BELOW TO FIND OUT MORE ABOUT THE GOOGLE SHOPPING CASE
Alongside the fine, Google was required to change or remedy its behaviour. Remedies in situations like this can be complicated but the one in the Shopping case is clearly not working because it actually makes it easier for Google to abuse what’s left of the competition. 130 companies and 28 industry associations made this clear in a letter to European Commission Executive Vice-President Margrethe Vestager. This problem might undermine Brussels’ efforts to rein in big tech, because, despite the Court's ruling that Google was rightly punished for its abuse, the non-functional remedy has failed to restore competition.
How could this happen? Well, Google was so intent on destroying an industry that was focused on consumer choice that it unsurprisingly created its own remedy to its advantage. In the past 10 years fighting Google, we have witnessed its endless delaying tactics and attempts to distract from the issues with irrelevant data and technical detail. The comparison market continued to be weakened as the European competition watchdog (DG COMP) navigated its way through a minefield created by Google. And, in our view, Google is unlikely to change its tactics anytime soon, continuing to play for time while crushing competitors.
“If, after the win in the Shopping appeal, the European Commission fails to re-examine the remedy, then things will go from bad to worse”
If, after the win in the Shopping appeal, the European Commission fails to re-examine the remedy, then things will go from bad to worse. I suspect Google will just appeal again and continue to use its own remedy to exploit whatever competition remains. DG COMP needs to quickly assess the lay of the land, and, this time, intervene robustly with enforceable remedies — created in conjunction with affected businesses. It mustn’t allow stalling and pettifogging from Google’s lawyers and lobbyists whose only objective, in our view, is to delay, delay, and delay. Europeans risk having no choice left when it comes to price comparison. If they want to know how much something costs, they’ll have to ask Google, who will tell them for free while charging sellers a pretty penny to appear at the top of Google’s search results.
“Don’t be evil” doesn’t stick as a motto but “Move fast and break things” could have a certain resonance. Give big tech long enough and there’ll be no real competition left, no real choice for consumers and no real pressure to keep prices low or to innovate. Of course, it might be tempting to focus on new cases that you stand a good chance of winning but the Google Shopping case, if left broken, could tarnish Vestager’s legacy.
“Give big tech long enough and there’ll be no real competition left, no real choice for consumers and no real pressure to keep prices low or to innovate”
The Digital Markets Act has been presented as a chance to set things right, restoring competition in digital markets everywhere. However, the power of this legislative fix is intrinsically linked to the DG COMP’s ability to ensure that its remedies actually work in antitrust cases. Jurisdictions like Turkey have shown that real change can be achieved against Google if there is a political will to act. Europe once led the world in revolutionising technology regulation and showed the world what was possible. If it wants to reclaim that leadership, it will have to show some true steel and conclude its unfinished business with the Google Shopping remedy.
This article reflects the views of the author and not the views of The Parliament Magazine or of the Dods Group