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European Union Rejects Google (GOOG)’s Revised Antitrust Offer


European Union Rejects Google (GOOG)’s Revised Antitrust Offer

European Union Rejects Google GOOG Revised Antitrust OfferEuropean Union competition commissioner Joaquin Almunia rejected Google Inc. (NASDAQ:GOOG)’s latest offer to settle an antitrust case on Friday. He said in a radio interview with RNE of Spain that the search engine giant is running out of time to come up with a satisfactory offer. For more than three years, the EU antitrust commission has been investigating Google Inc. (NASDAQ:GOOG) GOOG +1.03% for its anti-competitive behavior. Its competitors, including Microsoft Corp. (NASDAQ:MSFT) MSFT +0.17%, Nokia Corp. (NYSE:NOK) NOK +0.92%, and Foundem have repeatedly accused the Mountain View-based company of blocking them in search results.

Google Inc. (NASDAQ:GOOG) initially proposed an offer in April to resolve the case. But its competitors said that the changes it proposed would only reinforce Google Inc. (NASDAQ:GOOG)’s dominance. The search engine leader revised the offer in October to avert facing charges, which may go up to $5 billion. The European Union antitrust commission had asked 125 of its competitors to review the offer and submit their opinions.

But about 100 of its rivals provided a negative feedback. Lobby groups such as FairSearch and ICOMP, and rivals including Microsoft Corp. (NASDAQ:MSFT) MSFT +0.17%, have submitted studies demonstrating that Google Inc. (NASDAQ:GOOG)’s revised offer drives little traffic to rivals.

In its October offer, Google Inc. (NASDAQ:GOOG) GOOG +1.03% had proposed to let rivals display their logos and have more prominent web links in search results. In shopping searches, the company had lowered the minimum bid from advertisers to buy slots on search results page from 10 cents to 3 cents. Google Inc. (NASDAQ:GOOG) had also offered to relax its terms that prohibit advertisers from expanding their ad campaigns to Bing and Yahoo.

Almunia said that the latest offer was not acceptable because it didn’t eliminate the Commission’s concerns regarding competition in vertical searches. A vertical search is a specialized query from users about a specific product. European Commission expects to settle the case by next spring. But if Google Inc. (NASDAQ:GOOG) fails to make a satisfactory proposal, which may result into a legal action, it may take more than two years.

Google Inc. (NASDAQ:GOOG) GOOG +1.03% defended its proposal, saying that the company has made significant changes, providing better visibility to rival services and addressing other concerns. In contrast, the lobby group ICOMP said that the search engine giant has been reluctant to change its ‘harmful practices.’ ICOMP counsel David Wood said that now it’s in the Commission’s hands to create a level-playing field and enforce competition rules to support consumer choices.

Google Inc. (NASDAQ:GOOG) GOOG +1.03% shares jumped 1.33% on Friday to close the session at the all-time high of $1,100.62.


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