Google's 'preposterous' antitrust remedies come under attack from rivals

Competitors believe Google's proposed antitrust remedies are a distraction from claims it manipulates organic search results.
Written by Liam Tung, Contributing Writer

Google's proposed measures to address competition concerns about its search business in Europe are "preposterous" and will likely exacerbate anticompetitive effects, according to its rivals.

The European Commission is using a market test to assess whether or not to make the proposals that Google submitted last month legally binding.

The proposals were meant, among other things, to address concerns over Google's placement of its own vertical services — such as its price comparison site, Google Shopping, and travel products — ahead of rivals in its search results. 

Google has offered to clearly label its own services and display links to three rival specialised search services, but according to Foundem, a UK-based search company that was among those who filed antitrust complaints with the EU back in 2010, the proposals divert attention from how Google manipulates organic search results and may make the competitive landscape worse.

The company wants the EC to reject Google's proposals and instead require that Google treat all services equally using the same crawling, indexing, ranking and penalty algorithms. Others, such as the lobby group FairSearch, broadly agree with this aim. 

Foundem argues (PDF) that Google's proposals focus exclusively on Universal Search, a box that contains blended natural search reslts with links to Google's own vertical search offerings, rather than the natural search results and AdWords that rivals believe it manipulates.

"This fundamental flaw means that Google's proposals cannot alleviate either aspect of the commission's concerns regarding search manipulation," it says. "The proposed changes would have no impact on Google’s ability to systematically penalise rivals in its natural search results and would do nothing to curtail the unassailable advantage that Universal Search affords Google's own services."

The company claims Google's offer to label its Universal Search boxes will have little impact on traffic diversion, and rivals will still need to pay Google to be listed alongside its own products.

For verticals which it monetises with pay-per-click or display ads, three rival links would be shown; for those it doesn't monetise, no competitors' links would be included; but for those it monetises with paid placement, three links would be included — as long as rivals paid for them to be so.

"If adopted, the paid rival link elements of Google's proposals would provide a powerful additional incentive for Google to transition its vertical services over to its new paid placement model," Foundem said.

"The introduction of paid rival links represents a potentially catastrophic escalation of Google's abuse, providing a new and immensely powerful anti-competitive tool, which in many cases would hand Google the majority of its rivals' profits," it said. 

Another gripe is that rivals can only apply to Google to be considered as a competitor in one product category, which Foundem claims will disadvantage companies with businesses across several product areas.

Meanwhile, Foundem accuses Google of systematically penalising vertical search competitors in its organic results under the pretext of "lack of original content".

Google previously denied it alters to its algorithms to hurt competitors after Jeffrey Katz, the CEO of Nextag, a US price comparison company, last June complained Google had made changes to its algorithm that would "effectively punish" them.

ZDNet has asked Google for comment on the Foundem report, and will update the story if it receives any.

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