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Consumer Watchdog Welcomes EU’s Antitrust Warning To Google, But Says Internet Giant Unlikely To Settle — Strong Measures Including Breakup Must Be Considered

SANTA MONICA, Calif. May 21, 2012

The European Commission said it was concerned that Google was favoring its own services in search, copying material from websites of competitors without permission, shutting out advertising competition and placing restrictions on the portability of online search advertising campaigns from its platform AdWords to the platforms of competitors.

Consumer Watchdog expressed deep concern about Google’s dominance of the mobile market, where Google has 95 percent of the search market.

Joaquin Almunia $38 billion

John M. Simpson

April 2010 Beth Wilkinson


Consumer Watchdog said regulators on both sides of the Atlantic could seek a variety of remedies:

— One possibility would be to break Google into different companies devoted to different lines of business.  Search could be separated from DoubleClick, its display-advertising unit.  Gmail could be spun off as a separate entity as could YouTube, a Google acquisition that should have been denied at the time of merger. Enterprise applications could be another separate business and mobile yet another.

— Google’s importance as a gateway to cyberspace requires a maximum degree of openness and transparency with the potential for government regulation. Arguably Google’s monopoly position and importance to the Internet means that the company should be regarded as a public utility and regulated.  Regulations could be designed to open up Google’s ad platform to enable other competitors to compete.  Rules could be crafted to create greater transparency in the operation of Google’s ad platform to enable parties to negotiate more effectively – for example: by providing greater visibility into the maximum amount of the highest bid, how many search terms are shown per page, and how Google’s "quality score" is derived and applied.  Little, if any, of this information is currently public and openness would contribute to consumer choice and options as well as foster competition.

— Another remedy would be to force Google to disgorge its monopolistic gains through the imposition of financial penalties.  The payment would have to be significant enough to impact Google’s future behavior. Perhaps the amount could be tied to paying back consumers for monetizing their private information and content without compensating them.

SOURCE Consumer Watchdog

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