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"Pro-trust" EU Competition Remedies for Google's Antitrust Violations

Google remains its own worst enemy in trying to resolve EU antitrust charges.

In early 2012, when Google was trying to convince EU antitrust authorities that enforcement action against Google's search practices -- preferring its own content in search ranking over competitors -- would only harm consumers and was unnecessary because competition was but "a click away" for consumers, Google announced it would consolidate 60 privacy policies without user permission or user choice to opt-out, and then did it a month later, over the EU's strong objections.

This was a flagrant strategic mistake because: first the EU prides itself for strong consumer privacy laws and privacy protections; second the EU fully-understands that consumers' privacy is the de facto currency that Google uses to propel its monopoly; and third Google's primary antitrust defense is that they are the ones that are best looking out for consumers interests and that consumers have plenty of choice.

Fast-forward to May when the EU publicly communicated its preliminary Statement of Objections (which outlined Google's four antitrust violations), and then fast-forward again to October when the EU's countries collectively communicated in a letter to Google that Google's new privacy policy violated EU law in several ways.

Now Google's continuous lack of full cooperation and compliance over the last several months with both the EU's competition and privacy enforcement authorities has created an EU enforcement perfect storm for itself.

When EU Competition Vice President Almunia finalizes the EU's formal Statement of Objections against Google and settles on the EU competition remedy requirements, with or without Google's cooperation, Google antitrust and privacy offenses and non-cooperation have created remarkable EU consensus around at least one logical joint competition/privacy remedy. That is having EU VP Almunia require that Google must get unambiguous consent of users for 2012 and future privacy policy changes to enhance user trust in Google's practices. Given how intricately intertwined and critical EU consumers' private information is to Google's business model, monopoly power and conflicts of interests, such a "pro-trust" remedy is a veritable no-brainer.

Moreover, Google would have a very hard time objecting to such a "pro-trust" remedy given how public Google has been in claiming to be fully committed to maintaining user trust and to how competition in this market does and should work.

  • In 2008, Google Chairman Eric Schmidt told MSNBC that "the moment we did something untrustworthy to any one of you, everyone of you would know within 5 nanoseconds, and it would become the conversation in the room and you all would move very quickly to a competitive choice."
  • In 2010, Google Chairman Eric Schmidt told the Telegraph: "…the reason that you should trust us is that if we were to violate that trust people would move immediately to someone else. We're very non-sticky so we have a very high interest in maintaining the trust of those users."
  • Today on its website, Google represents itself as working for users and promises to users: "We never manipulate rankings to put our partners higher in our search results and no one can buy better PageRank. Our users trust our objectivity and no short-term gain could ever justify breaching that trust;"

If Google has been forthright in these public representations and promises, they should have no objection to such an antitrust consumer protection remedy.

Furthermore, Google also should be supportive of the "pro-trust" remedies listed below that could help fix the fundamental inherent problem that Google's founders' identified in 1998 when they invented their search engine. "…we expect that advertising funded search engines will be inherently biased towards the advertisers and away from the needs of the consumers. Since it is very difficult even for experts to evaluate search engines, search engine bias is particularly insidious." … "…we believe the issue of advertising causes enough mixed incentives that it is crucial to have a competitive search engine that is transparent…"

Some "Pro-trust" EU Competition Remedies for Google's Antitrust Violations:

  1. Require Google to get unambiguous user consent for 2012 and future privacy policy changes; and empower users to be able to specifically opt-out in part, or in total, from Google+-DoubleClick-YouTube-Android-AdMob related tracking of their private online activities and aggregation of their private information into an uber-digital-dossier on them.
  2. If labeling becomes a part of the overall remedy, Google search results should have a clear and conspicuous user-warning label at the top of every search results that Google has a proven financial-conflict-of-interest and bias in search ranking to preference Google-owned content or Google-Partner content over competitive content.
  3. Require more transparency and frequent independent audits of Google's search business practices to protect competition and user privacy going forward.
  4. Declare Google a monopolist that has acted anti-competitively in a Statement of Objections, or require in any settlement a clear Google public admission of liability by Google that it has a monopoly and has violated EU antitrust law -- so that Google is held fully-accountable to the EU's rule of law, and so that other private actions can benefit from the EU findings of fact in private antitrust and privacy court cases.
  5. Since the EU has concluded Google is a monopoly which is acting anti-competitively, the EU remedy also should change the burden of proof for Google, during any enforcement period, that if competitors allege similar offenses in the future to what Google has been found guilty of in the Statement of Objections, the burden of proof should be on Google to disprove the charges. This is what the EU has required of Microsoft and others in the past.

In sum, Google's own behavior and non-cooperation has created a perfect storm of EU competition and privacy enforcement against Google. The suggested "pro-trust" remedies above are by no means comprehensive, but pointedly show how remedies can be crafted to not be about protecting competitors but to be about protecting competition and consumers, which is what Google publicly claims to support wholeheartedly.

 

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