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Will Google's rivals swallow the 'labelling remedy' pill?

Web giant's in Europe now, where complainants count

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Analysis Google will have a green light to offer "manipulated" search results and "to discriminate against competitors" if its preferred competition remedy is accepted by the EU, at least according to 39 national consumer bodies in Europe.

We don't yet know the specifics of the terms Google offered (and that the European Commission will reportedly accept). But it appears that it's a very liberal remedy which goes no further than requiring Google to label its own services as Google properties.

Labelling would merely require Google to state the obvious - that Google Maps is owned and operated by, er... Google. Google would be free to promote its own services above others in its search results. Critics believe that a labelling remedy merely perpetuates the injustice.

The national competition quangos from 30 European countries declared back in January, in a remedy paper by BEUC - which the EU funds to lobby itself - echoed this line:

Simply requiring Google to label its own vertical search services would not prevent the company from manipulating search results and discriminating against competing services. Although the labelling of Google’s own services is crucial in order to enable consumers to make informed choices, it cannot be the sole solution. Infringements of competition rules call for strong and rigorous remedies which go beyond consumer information.

[Source: BEUC remedy paper]

BEUC called for an alternative remedy - an "even-handed" principle, in which Google "must hold all services including its own to exactly the same crawling indexing ranking display and penalty algorithms".

What would that look like in practice?

Currently a service such as Google Maps is not subject to these rules. Google makes an editorial decision to insert Google Maps at the top of a universal search results page, because it thinks it's useful and relevant. BEUC would prefer to see Google Maps indexed.

The upshot would be that Google's own Maps may well be the map of choice for a search results page - given that it's popular - but others would meet the criteria too.

There are certainly arguments of merit on both sides of this. One irony is that Google has historically positioned itself as the antithesis of a publisher - with humans making subjective editorial judgements. Yet that's exactly what Google's universal page is - an editorial property.

It would gain more sympathy if it simply called for editorial freedom, and this freedom must include the ability to promote itself. Surely, few sophisticated users are unaware that Google is a vertically integrated internet services and advertising company, one which sensibly plugs its own services?

Yet that argument doesn't change the numbers. The issue of market dominance doesn't go away, and this is merely a stage in the process.

Former trade union baron Joaquin Almunia, the EU's competition commissioner, may have a relationship with Google chairman Eric Schmidt that's almost as cosy as two texting teens - but he has to put the weight of the EC up against any legal challenge.

The complainants in the fair search case appear to be in no mood to accept labelling, judging by iComp counsel David Wood's comments here.

Unlike US settlements, the complainants are part of the process - they need to find the remedies acceptable. If they don't, the European Commision would be forced to take the stand, side-by-side with Google - arguing against what its rivals consider to be "fairness", and against small internet companies.

What bureaucrat, in their right mind, would want to do that? Isn't the EU unpopular enough already? ®

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