At the end of 2014, Margrethe Vestager became EU Commissioner for Competition Law. Half a year later, Time magazine called it " Google's worst nightmare ". The Danish politician quickly made it clear that she wanted to use her position to take action against one of the most powerful Internet companies in the world, one that is said to be almost indomitable: Google.
Since then, the company has been fighting against Vestager with power. But after the court of the European Union has now confirmed a 2.42 billion euro competition fine against Google, it looks like Google's nightmare is actually coming true.
The EU Commission imposed the penalty in 2017 because Google's own product comparison feature, Google Shopping, was said to have been preferred to other comparison portals in the Google search engine. When looking for a product, the company's own price comparison was displayed much more prominently than others, was the charge - from the Commission's point of view, an unlawful distortion of competition. Google has sued against this, and the court has now ruled: The company has actually abused its market power, and the fine of 2.42 billion euros was justified.
2.42 billion euros is a significant amount of money - even for the Google parent company Alphabet, which recently reported making almost 19 billion dollars in profit. The current decision is about much more than that.
The judgment confirms the course of the EU Commission
The judgment can still be appealed to the next instance, the European Court of Justice. Nevertheless, it is groundbreaking as the first decision to confirm such a billion-dollar fine. It shows that the course that Vestager and the Commission have taken also prevailed in court. Using competition law to put tech companies in their place can work. They cannot just do what they want, they have to be dealt with by legal means.
This idea is closely linked to Margrethe Vestager - Google's nightmare is also her dream. On its initiative, the Commission has repeatedly imposed high fines on Google in recent years using the lever of antitrust law. The group is also abusing its market power, for example, by forcing smartphone manufacturers to preinstall apps such as Google Search or the Chrome web browser if they want to use the Google Android operating system, was another allegation. Due penalty: 4.3 billion euros. Another case of online advertising amounts to 1.49 billion euros. Google has also appealed against these penalties in court, and decisions are pending here as well.
The court's decision could lead to further, similar proceedings. Competing providers are already speculating that Google may also have preferred its own price comparison function to other portals for airfares, hotels or restaurants. The restaurant rating app Yelp, for example, has been raising such allegations for years.
It's not just about Google
In a broader sense, however, the judgment also sheds light on other decisions that have nothing to do with Google, but with other large tech companies. Even Apple and Facebook raises the EU right to use unfairly their own infrastructure to open up new markets. The cases are similar: Apple, for example, is accused of preferring its own music streaming service within the app store over competitors such as Spotify. Of course, these cases have to be examined individually. Nevertheless, one can read the judgment as a confirmation of the Commission's approach.
Incidentally, this approach should not be confused with calls for the smashing of Google, Facebook and other corporations. Vestager likes to emphasize that she is not "after Google" and certainly does not want to assert European interests against US corporations, but simply fight for fair competition. Breaking up, Vestager said a few years ago, that would be the very last resort for her. She prefers to ensure that misconduct becomes really expensive. Perhaps so expensive that it motivates companies to rethink.
Vestager's antitrust penalties often play an important role when someone argues that the EU can counterbalance the Silicon Valley capitalism of the US and the high-tech dystopias of China through smart and strict regulation. Vestager is now also the EU Commissioner for Digital and Vice President of the EU Commission. In this role, she campaigns for the Digital Services Act - another pillar in the regulation of tech giants.
The draft that the Commission has presented for the law is seen as a paradigm shift. In a democracy, platforms like Facebook and Google are "not called to decide the rules of the game," Vestager said in a recent speech in Berlin. Perhaps the corporate nightmare has only just begun.
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