The resolution correctly drew attention to the important role search engines play in our digital economy today. Without them, we wouldn’t be able to find what we were looking for online. These searches also generate a great deal of information that can be commercialized.
It is not the first time that competition rules have been applied to different parts of the EU economy, such as telecommunications. The suggestion that the European Commission consider “unbundling” search engines from commercial services is provocative and has raised some eyebrows among politicians and trade groups on both sides.
Google is the clear target of the resolution. The European Union has been investigating Google for several years. This investigation was prompted by allegations that Google favors its products and services when it returns search results. Google’s ability to link its search engine with other products and services has given it a competitive edge that is difficult for others to match. Google is said to have a 90% share of the European search market, leaving little room for competitors.
In reality, separating the Google search engine from its other products and services means splitting the company into two. The search engine would be the sole focus of one part, while the other would have control over other Google products and services such as Gmail, Android, and YouTube. The question is whether the EU can break up a US-based company.
Do Google searches and advertising have a bias?
The resolution’s substance and the potential impact it could have on US-EU relations are of concern to both sides of US Congress. Gunther Oettinger is the EU’s Digital Commissioner, and he has spoken out against breaking up Google.
While it is unlikely that Google would be forced to separate, there are other options. One of them is to disentangle the company by cutting the link between the search engine and the ads that appear at the top. Google’s control over the ads at the top of your search results, which may link to other Google services, is one of the major competition concerns. One way to avoid this would be to ban links from these ads that lead to other Google products. Google’s competitive advantage in linking its services together will prevent it from unbundling.
Increase the pressure
The fact that the resolution passed with a wide margin (384 MEPs in favor, 174 against, and 56 abstained) shows widespread support to tackle the issue. Google has also been warned to address European concerns about its business practices, or else face future trouble.
This issue is part of a larger debate in the EU about its digital market. In the EU, there is growing concern that US-based firms currently dominate the digital market: after all, we use Google to search, Amazon for online shopping, and Facebook to share photos and comments with friends.
They have a number of commercial advantages due to their ability to use their dominant position in one market for entry into another. This is done by collecting and analyzing the vast amounts of data generated by their primary business. They also put smaller competitors at a disadvantage regardless of their location.
In fact, the idea that Google and other companies should be debundled has overshadowed the rest of the debate on competition. The EU’s competitiveness could be improved by improving its telecommunications, creating a unified market, or improving online literacy among its citizens. If the EU wants to take advantage of the new digital opportunities, it will need to act in many other areas.