Alphabet Inc (the parent company of Google) recently reported $3.5 billion on its second quarterly statements, a significant $1.4 billion less than last year’s second quarter. The decline was the result of the European Union slapping Google with a $2.7 billion anti-trust fine the previous month. According to the EU commission, Google used its European shopping platform, Google Shopping, to unfairly decrease traffic for their rival retailers.
Why is this illegal? Doesn’t Google have the right to direct traffic the way they see fit since they own the platform? First off European regulations are more stringent than American regulations, as American companies are only fined if consumer prices go up due to monopolistic power. The main accusation of the EU commission is that they were using their dominance of the market to stifle their rivals by using search algorithms that prioritized Google’s retailers.
Google rejects these accusations and plans to take this case to the European Court of Justice to overturn these fines.