Report from Reuters
In Brief – The European Commission has fined Google €890 million ($1 billion) under the Digital Markets Act (DMA) for unfairly treating “vertical search” competitors and not appropriately allowing app developers to steer users to cheaper payment options available outside of Google’s app store. Despite the fines, the regulators praised Google’s recent progress toward compliance on both matters indicating that more penalties may not be forthcoming. The Commission imposed a €460 million fine for favoring Google’s own vertical shopping, hotel, transport and sports services in search results, and a €430 million fine for restricting app developers from directing users to cheaper offers outside of the Google Play store. The company criticized the decisions and said it may appeal, arguing the required changes will degrade popular Search features and weaken Google Play’s security protections. Regulators will continue assessing Google’s compliance efforts, as well as whether similar principles should apply to Google’s AI Overviews and AI Mode.
Context – These fines are waypoints on two policy battles stretching back years. Arguments over the “fairness” of Google search has been a morass for decades. Charges that they penalize vertical search competitors was the issue in the EU “Google Shopping” case that started in 2009 and resulted in a €2.4 billion fine in 2017. Google (and Apple) have fought app store litigation and regulation globally since Epic Games sued them in 2020. These DMA investigations were two of the first DMA cases filed in 2024 and negotiations involving Google, specialized vertical search aggregators, hotel chains, airlines and others who want high rankings too, and Commission officials have been underway since. Fines were always a given, and the prospect that all search stakeholders will ever be happy are close to zero. Meanwhile, the Commission’s DMA specification proceedings directing Google in how to share search data with search competitors and open Android to AI competitors will have bigger impacts, and imposing rules on Google’s use of AI in search is now a more pressing issue to most third-party websites.