The EU has issued preliminary findings charging Google with two violations of the landmark Digital Markets Act competition rules, which were brought in to increase competition in the face of the overwhelming dominance of large tech companies.
The European Commission also issued Apple with initial technical requirements on how it expects the iPhone maker to comply with the DMA.
The first charge relates to Google’s alleged preferencing of its own services in Google Search.
Search self-preferencing
Google search services such as shopping, hotel booking, transport, or financial and sports results are treated more favourably in Google Search results than similar services from third parties, the Commission said.
“More specifically, (Google parent) Alphabet gives its own services more prominent treatment compared to others by displaying them at the top of Google Search results or on dedicated spaces, with enhanced visual formats and filtering mechanisms,” the executive agency said.
The second charge states that Google breaches the DMA in its measures to restrict developers from informing users of better deals outside of Google’s Play Store app store.
“Alphabet technically prevents certain aspects of steering, for instance, by preventing app developers from steering customers to the offers and distribution channels of their choice,” said the Commission in a statement.
It said the fees charged by Google for facilitating the initial acquisition of a new customer by an app developer via Google Play go “beyond what is justified”.
Excessive fees
“For example, Alphabet charges developers a high fee over an unduly long period of time for every purchase of digital goods and services,” the Commission said.
The Commission previously fined Apple 1.84bn euros for unfair restrictions on music streaming developers last year in an investigation that predates the DMA.
The agency said changes Google has made to comply with the DMA have not gone far enough. Competitors have previously complained that Google’s proposed compliance plans are designed to maintain its dominance or increase it.
Teresa Ribera, the EU’s competition commissioner, said the decisions aimed to “ensure that Alphabet abides by EU rules”.
“Our main focus is creating a culture of compliance with the Digital Markets Act,” Ribera said.
“Non-compliance proceedings are reserved for situations where attempts at dialogue have not been successful.”
‘Malware and fraud’
Google said the rulings would hurt consumers and businesses.
Oliver Bethell, Google’s senior director of competition, said the Commission’s proposed changes would “make it harder for people to find what they are looking for and reduce traffic to European businesses”.
Changes to the Play Store would expose users to “malware and fraud from bad apps”.
He said Google would continue to engage with the Commission and comply with EU rules.
A US judge last August found that Google sustained an illegal monopoly with its search services.