July 25, 2012

Why the EU Has it Out for Google


Despite reports that a reconciliation in underway between Google and the EU, it’s beginning to look like the European Union is cracking down on gigantic Internet-related U.S. companies that dominate the global market.

Reports indicate that the European Union (EU) is demanding “concessions” from Google over what the Commission perceives as anti-competitive behavior. The EU claims that Google is abusing its position as the world’s leading search engine to promote its services over others, as well as unlawfully snatching information like restaurant reviews from other sites without their consent.

According to EU Competition Commissioner, Joaquin Almunia, in order to reach a “level of good understanding…we will need worldwide solutions.”

Google is not only the leading search engine in the U.S., but it continues to dominate the market with products and services ranging from social networks to mobile devices, to autonomous vehicles. But they are not without competition. Amazon, Apple, Facebook, Samsung and many others are carrying their own weight.

However, this might not be the case in Europe.

The European Commission conducted research last Spring that indicates that Europe’s youth is not equipped with the IT skills needed to compete in the new digitalized global economy. Despite standout countries like Britain, Germany and France, Europe is behind countries like China in migrating toward the technology juncture.

“Young people need to appreciate the professional aspects of the new digital world… This is more important than ever in the current economic context,” said Antonio Tajani, EU Commissioner of industry and entrepreneurship. “And it is crucial to increase creativity which will favor entrepreneurship and new start-ups."

According to reports, if Google fails to meet the EU’s demand, they could face a $4-billon lawsuit – 10 percent of their annual gross. But Google has announced that they are prepared to offer their full cooperation in order to avoid this, perhaps avoiding a situation similar to Microsoft’s, who challenged the EU and as a result went through a long, tedious and expensive process.

A situation that occurred at Dutch University, Tilburg, regarding Microsoft’s Live@edu, signifies the differences between U.S. companies under their own jurisdiction versus the EU. Tilburg was announced the first Dutch university to switch over student e-mail accounts to Microsoft’s Live services, but Tilburg later opted for Google’s cloud services instead.

The problem, according to those involved, was that Microsoft took too long to have its services ready for the upcoming semester. Though the same report states, “But in the Netherlands most universities and colleges have been skeptical of giving up control to these American IT giants.”

So why then did Tilburg use the services of Google, another U.S. giant? Apparently, Google changed their contract to abide with the European Union. According to a source, “The fact that data in Microsoft's European cloud is as accessible to U.S. government agencies as Google's worldwide cloud really was an eye-opener.”

When companies are suspected of anti-competitive tactics in the U.S. – as seen most recently with cable companies Comcast and Time Warner – the Federal Communications Commission (FCC) investigates the matter followed by the Department of Justice. But in many of the situations regarding gigantic corporations, the disputes lie between two companies – like Samsung and Apple or Google and Oracle – to be resolved in court.

But what happens in the U.S. is one thing, in Europe another.




Edited by Braden Becker



Related Tags

Cloud    Facebook    Google
Microsoft    Apple    Oracle

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