European Commission fines Google €2.4B but that is just the start of the story

The European Commission has just fined Google for abuse of dominant position for giving an illegal advantage to its own comparison shopping service on search results. The fine is big €2.4B but it is simply the beginning of a long story instead of the closure of another.

The decision also requires Google to cease its infringing practice within 90 days, leaving squarely on the company's shoulders the explanations of how it intends to comply with the order. As the Commission did not mandate any specific remedies, this is due to become particularly problematic.

It is likely Google will appeal the fine and drag its feet on changing the way it operates for two reasons. First, there is no incentive to do so otherwise - paying the fine and changing practice would be an admission of wrongdoing and no manager wants to have a €2.4B hole on its finances to explain. So we can expect Google to drag this through the courts. Second, the process takes so long that the real final decision (assuming it maintains the current one) may well be 10+ years away from now. What will be the purpose of changing search results then? And inflation will eat into that €2.4B fine. Plus, from the perspective of Google's executives a protracted court battle means that it is likely that when closure happens they will all be long gone.

As I argued last year in this blog, current abuse of dominant position rules are not the correct deterrent to solve this issue as they are too slow to be useful. In a world where technology waves become shorter and shorter, speed is of the essence also for competition enforcement. I called at the time for abuse of dominant position enforcement to either be sped up or in alternative dropped all together. I maintain most of that view and would suggest looking into merger control rules as an alternative.

In any event, today's decision is simply the start of a long drawn out process.