German officials have found in an antitrust probe that Google has significant control over the market. This enables special market abuse controls.
It seems that the gears of antitrust are moving some more. Earlier, we reported on the Facebook antitrust lawsuit moving ahead in the US. The Federal Trade Commission (FTC) took a second kick at the can after their first attempt fell flat in the courts. Facebook tried to have the lawsuit blocked again, but were unable to convince the judge to dismiss the lawsuit outright. As a result, the FTC’s efforts are still alive, albeit, on shaky ground.
While that is happening in the US, it seems that there are developments happening elsewhere in the world. Google has been facing an antitrust probe in Germany. Results are now coming in and it doesn’t appear to be good news for Google. From Tech Crunch:
In a decision as significant as it is unexpected, Germany’s antitrust regulator has concluded that Google’s business meets the threshold for special abuse control which was established under an update to competition law targeted at digital giants and passed at the start of last year.
The finding that Google has “paramount significance across markets” is the first such decision taken by Germany’s Federal Cartel Office (aka the Bundeskartellamt) — which has ongoing procedures assessing the same vis-à-vis the market power of Amazon, Apple and Meta/Facebook — and it stands for five years, paving the way for antitrust interventions which could prefigure incoming pan-EU ex ante rules also targeting tech giants’ overbearing market power (aka, the Digital Markets Act).
“The Bundeskartellamt holds that Google is of paramount significance for competition across markets within the meaning of Section 19a(1) GWB [Gesetz gegen Wettbewerbsbeschränkungen; aka the German Act Against Restraints of Competition]. The company has an economic position of power which gives rise to a scope of action across markets that is insufficiently controlled by competition,” the FCO writes in a press release today.
The regulator says its assessment factored in Google’s dominant market share of general search (80%+ in Germany); its market power in online advertising; its intermediating role as a gatekeeper of key services like YouTube and the Play Store on Android (which the FCO likens to “infrastructure”); its access to data as a result of holding so much market power — enabling it to further stoke competitive advantage via ad targeting and product development; and its market capitalization, which the regulator notes is “one of the highest worldwide and reflects Google’s large financial power”.
This is far from the first time Google (AKA Alphabet) has faced questions about its dominant market control. In 2020, there was significant activity that involved Google being one of the targets for antitrust lawsuits in the US. We counted three of them back then. At the time, though, there were questions over whether this was just one of many distractions by the Trump administration to cover up critically massive failings. That, of course, is not to say that there simply isn’t antitrust concerns surrounding the biggest players in technology, though.
At any rate, this appears to be the latest in ongoing antitrust pressure being exerted on the large tech giants. This will definitely add the momentum for those who seek to “reign in big tech”. Up until recently, those efforts have generally led to disappointment for big tech critics. Now, we are seeing decisions that would be favourable for them.
Drew Wilson on Twitter: @icecube85 and Facebook.
