Archive for the ‘Search’ Category

« Older Entries

Google’s commitments: too little, too late?

Thursday, April 25th, 2013

Following weeks of speculation, we are pleased to see the publication of a market test notice and look forward to the opportunity to analyse and respond to Google’s proposal in a constructive manner. It is vital to ensure that the market test is thorough and robust and is not simply an exercise to “tick the boxes”.

As we have repeatedly said, it is very important to provide complainants and interested parties with the opportunity to review the proposals and offer their observations, including evidence to show how the proposals will play out in practice. Google has had some time to test the proposals and how they might affect user clicks. We believe complainants and others also have an important role to play not least because of the sectoral expertise they offer. However, they must be provided with enough information and time to make the detailed analysis that is required.

If the proposals don’t clearly set out non-discrimination principles and the means to deal with the restoration of effective competition, plus effective enforcement and compliance, it’s very difficult to see how they can be satisfactory. Commissioner Almunia has himself stated that returning competition to markets effectively destroyed by Google’s dominance and abuse of that position is the main aim of this investigation.

We will comment further once we have had an opportunity to evaluate the proposals in more detail but it is clear that mere labelling is not any kind of solution to the competition concerns that have been identified. Google should implement the same ranking policy to all websites. This should include their own vertical services which currently have their ranking unfairly manipulated to appear at or near the top of search results.

Tags: , , , , , , ,
Posted in Competition, Healthy Marketplaces, Search | Comments Off

A dominant player and the public purse: The damage of Google’s ‘economic investment’

Wednesday, April 24th, 2013

“We’re a key part of the electronic commerce expansion of Britain which is driving a lot of economic growth for the country,” claimed Google Chairman Eric Schmidt in defense of Google’s low corporation tax payments yesterday. However, the reality is that there has been a high price to pay for Google’s ‘investment’ in the online world and one of ICOMP’s Members who began business as an online start-up, has a very different story to tell.

Dr. Marc Pinter-Krainer, Founder & CEO of online news portal, One News Page responded to Schmidt’s comments: “I found the impact of Google’s search services to be detrimental to my business in its early days. I started One News Page in 2009, and as an experienced entrepreneur, I was excited about the opportunity to build a successful online news resource.

“Only a few months after later, my website was subjected to an unexplained “penalty”, imposed by Google without any justification. The effect of this was that One News Page no longer appeared in Google’s search results. As Google dominates the online search market, this meant that our site effectively disappeared from the Internet.

“We were lucky to have the support of our investors throughout that difficult period, after which, Google eventually lifted the imposed restrictions in 2010 – again without any explanation. I now know first-hand that rather than empowering smaller busineses, Google’s anti-competitive conduct has the power to cripple innovative businesses,  leading to less choice and less innovation, both of which hinder the growth of the online economy.”

This is just one story among many within ICOMP’s membership, highlighting the damage caused by Google’s so-called ‘investment’ in the online marketplace. It is stories such as these which have driven several businesses to make complaints of Google’s abusive practices to the European Commission, in a bid to save the future online economy within Europe before it’s too late.

Unsurprisingly, in a naïve attempt to gloss over the company’s misdeeds and pull the wool over the nation’s eyes, Schmidt’s further defence that Google’s employees pay tax has also failed to resonate amongst MPs. Chairman of the Public Accounts Committee, Margaret Hodge vociferously responded  by saying “I get fed up of hearing these global corporations saying they are contributing in other ways. Of course they employ people and those people pay tax.” Hodge’s words were also publicly supported by Labour MP Fiona Mactaggart.

Schmidt’s additional claims to have empowered billions of start-ups through Google’s advertising network is also a menial offering. The very advertising network he refers to, offers free Adwords to new businesses but rather than helping them innovate, only serves to get them hooked into Google’s services. Meanwhile the company strategically uses anticompetitive practices to cause harm to any potential competitive threat.

Most telling out of all of this are the comments of online users saying they wish they could boycott Google (as some have with Amazon) but can’t – a clear sign of a dominant player and who has hampered the ability of alternative services to compete fairly, if ever there were one and provide consumers with an alternative choice.

Tags: , , , , , , , , , ,
Posted in Healthy Marketplaces, Online Marketplace, Search | Comments Off

Google in last chance saloon

Wednesday, April 24th, 2013

After over 2 years of formal inquiry and negotiation, the online industry is now set to have its say on whether Google’s proposed remedies will effectively end the abuse of its dominance, restoring competition to the marketplace. ICOMP welcomes the formal market testing phase of the Commission’s investigation as a significant step forward and possibly a new lease of life for the digital ecosystem.

After years of denial and obfuscation, Google’s submission of remedies for market testing constitutes a de facto admission of dominance and abuse. Google has also finally accepted that any solution worthy of the name would have to involve changes to its search page – action it has never before countenanced. The fact that these admissions and concessions come only at the eleventh hour and only when the Commission saw fit to wield the threat of direct punitive action is disappointing but does not lessen their significance. They are certainly not concessions which would have been given willingly.

Market testing now presents the final and best opportunity for those harmed by Google to obtain redress. Recent leaks suggest that, perhaps unsurprisingly, Google’s offer falls far short of what is needed to provide this redress. If this is the case, it will be incumbent on the rest of the industry to stand up and make its message clear: “we need far more serious improvement if we are to level the playing field.”

ICOMP hopes, of course, that Google’s commitments will be rigorous, meaningful and published in detail for scrutiny and testing by those they will affect. In any event, the commitments will provide compelling evidence in any future action for damages.

It is perhaps the essential principle of a healthy marketplace that a company which enjoys Google’s overwhelming dominance cannot fail to offer a guarantee of equal treatment to would-be competitors. In view of Mr Almunia’s commitment to restore effective competition and the Commission’s own guidelines which refer repeatedly to need to deal with ‘persisting effects’ of infringing behaviour, the Commissioner must not accept anything which falls short of this.

ICOMP calls upon all concerned to participate and provide the evidence which allows the Commission to perform its duty and, if necessary, insist on enhanced commitments.

There is everything to play for.

David Wood, ICOMP Legal Counsel

Tags: , , , , , , , , , , ,
Posted in Healthy Marketplaces, Legal Actions, Online Marketplace, Search | Comments Off

Google’s Offer Requires Robust Market Test

Thursday, April 11th, 2013

News that Google has submitted a final remedies offer to the Commission, recognising that change in their business practices is necessary in order to restore competition to the online market, is potentially welcome but certainly comes with caveats. Providing complainants and interested third parties the opportunity to review the proposals and offer their observations is an important part of the process. It is now vital to ensure that the market test is thorough and robust and is not simply an exercise to “tick the boxes”.

For the Commissioner to achieve his main aim, which is returning competition to markets effectively destroyed by Google’s dominance and abuse of that position, it is imperative to fully involve those relevant parties, such as complainants, in any final decision. This is not least because of the sectorial expertise they would provide, expertise that few others are in a position to offer.

The opportunity offered by robust market testing to ensure the delivery of effective and future proof remedies must be grasped. As has been publically stated by a number of complainants in this case, there is concern that Google’s settlement offer will fail to deliver this and thereby negate the return of competition to the search and search advertising markets.

Additionally, to ensure the final outcome is future proof it is important to consider market developments such as mobile search in the process. There are also many other issues besides the four core concerns highlighted by Commissioner Almunia (search manipulation, scraping, exclusive advertising arrangements and restrictions on ad data portability) that need to be dealt with, and swiftly.

Even following a market test, an outcome that fails to stop Google from manipulating search results will be a failure.

It is also ICOMP’s view that any settlement reached following the market test must be robust and enforceable. This is especially true given Google’s well-documented history of dealing with authorities with less than good faith and of failing to live up to its commitments.

Given the time and resources spent on the prolonged investigation, the Commissioner must maintain full transparency including publishing the results of the full investigation and whether they believe Google has abused the dominant position held in search and search advertising.

Tags: , ,
Posted in Healthy Marketplaces, Online Marketplace, Search | Comments Off

Complainants to Commission: “only sanctions will reinstate competition”

Friday, March 22nd, 2013

Today, eleven of the companies which complained to the European Commission about Google’s anticompetitive conduct published an open letter to Commissioner Almunia calling for official sanctions against the company.

The signatories to the letter, which included ICOMP Members Foundem, Hot Maps and Streetmap, voiced concerns that any settlement agreement would not sufficiently address the issue of how Google ranks competitors in its search results.

“There are two equally important aspects to Google’s search manipulation practices,” says the letter: “the systematic promotion of Google’s own services, and the systematic demotion or exclusion of its competitors’ services. Any effective remedies will require explicit commitments to end both aspects; remedying one without remedying the other would simply allow Google to recalibrate the un-remedied practice in order to achieve the same or equivalent anti-competitive effect.”

The complainants said that the overarching principle would ensure a permanent restoration of competition is that Google must be even-handed. “It must hold all services, including its own, to exactly the same standards, using exactly the same crawling, indexing, ranking, display, and penalty algorithms.”

Commissioner Almunia’s statement at the end of January of his “conviction” that Google “are diverting [search] traffic,” was encouraging to complainants and the online marketplace at large. “They are monetising this kind of business,” he told the Financial Times, “the strong position they have in the general search market and this is not only a dominant position, I think – I fear – there is an abuse of this dominant position.”

Since these comments, however, Google has proposed a remedy package which the Commission is currently considering. The contents of this settlement have not yet been shared but complainants fear that it will not deal with allegations that Google forcibly demotes rival sites through penalties, a concern amplified by Google’s past conduct which “suggests that it is unlikely to volunteer effective, future-proof remedies without being formally charged with infringement.

Additional to Google’s illicit business practices is the enormous advantages of scale it has used them to amass; advantages which, for example, enable it to cross-subsidise loss-leading services using its advertising revenue in order to undercut competitors. It is almost inconceivable that a remedy package from Google would address this point. This is another reason why complainants are saying that nothing short of an official sanction will save online competition. ICOMP calls upon the Commission to listen to the marketplace and act on its advice.

Tags: , , , , , , , , ,
Posted in Online Marketplace, Search | Comments Off

Against the Goliaths of the online marketplace the law must stand behind David, says Reding

Wednesday, March 20th, 2013

Yesterday the European Commission’s Vice President Viviane Reding addressed the EU Consumer Summit on the issue of enforcement.

Ms Reding reaffirmed the vital importance of consumer defences, particularly in times of economic crisis, saying that consumer spending accounts for 56 per cent of the EU’s GDP but that its full potential could only be tapped once consumers were given the confidence to shop across EU borders. This confidence, said Reding, has to stem from consumer rules which “protect David when he is negotiating with Goliath.”

The Vice President went on to say that “strong rules become weak when they can be disregarded with impunity” and that therefore, the Commission needs to take a more prominent role in monitoring and coordinating enforcement of these rules, in particular by:

  • Making use of the Unfair Commercial Practices Directive to improve consumer welfare;
  • Simplifying internal procedures and strengthening deterrents within Member States; and
  • Ensuring information supplied to consumers about legal rights and warranties is accurate.

One area specifically mentioned by Reding as a market where consumer vulnerability continues to be exploited is the online sphere – a problem about which ICOMP has spoken extensively.

The behaviour of today’s digital “Goliaths” is all too often inimical to the interests of consumers. Taking, for example, the issue of privacy, consumers are often given little or no indication of the policies which apply when they use online services and have scant recourse when they feel their concerns have been ignored. As the number of ongoing multijurisdictional privacy investigations will attest – certain dominant online service providers clearly recognise no existing deterrent to their infringement of consumer privacy rights.

Ms Reding makes an important point when she says that it is up to the Commission to enforce the rights of the consumer and that this needs to extend beyond the high street. ICOMP Director Auke Haagsma said “Ms Reding is right that the Commission cannot sit on the side-lines when rules are disregarded.  We welcome her determination to ensure that these protections are  extended to the digital marketplace.”

Tags: , , , ,
Posted in Healthy Marketplaces, Intellectual Property, Legal Actions, Online Marketplace, Privacy, Search, Security | Comments Off

CNIL Continues Investigation – UPDATE

Thursday, February 28th, 2013

On 16th February 2013, France’s National Commission for Computing and Civil Liberties, (CNIL) announced that in response to Google’s Privacy Policy, it would be forming a working group “in order to coordinate their repressive action which should take place before summer”. The probe itself focused on the degree to which the Privacy Policy directly impacts the personal privacy of its users.

This latest announcement indicates that not only has the Data Protection Authority found that the concerns it was investigating are valid, but the advertising giant has also proven to be non-cooperative throughout. The CNIL’s statement noted that Google had not provided “any precise and effective” responses in answer to an EU-wide investigation and that this was a deciding factor in the continuation of the investigation. This has in fact been the disposition of Google throughout the process.

Going back as far as May 2012 just 8 weeks after concerns were initially voiced, the French Data Protection Authority (the CNIL) wrote to Google expressing its regret that responses to earlier questionnaires concerning Google’s privacy policies were “often incomplete or approximate”.

A further indication of Google’s disassociation and even disregard for Europe’s DPAs has been its ever present statement in response to media enquiries, which has not changed at all since the start of the investigation, even though the circumstances have evolved. The statement itself in fact seems to be completely at odds with that of the CNIL, with Google expounding on-going engagement and coordination whilst the regulators saying the complete reverse.

ICOMP Director Auke Haagsma said, “As ICOMP’s director with responsibility for our Privacy Working Group I have been meeting with a number of lawyers, regulators, media and other concerned parties around Europe to discuss how to get the right balance on privacy. One thing stands out from all these conversations: people want to be able to trust that companies to whom they give sensitive personal information use that information very carefully and in full respect of their privacy. Google’s attitude towards the CNIL specifically and European Privacy rules generally seem to fly completely in the face of this reasonable expectation.

Just two days after it refused to even respond to the CNIL and provide clear explanations to the users of its products on what personal data it collects and what it will use this for, Google’s Global Privacy Counsel called Europe’s privacy rules “whacky” and  “hopelessly vague”.  His view is very simple: if Europe wants “fast innovation” which is “the only hope to maintain high rich-world living standards for our aging Western societies” it has to allow Google to act as it pleases, if it wants to protect the privacy of its citizens Google will offer them “slower, less-cutting-edge services”. 

ICOMP will continue to conduct conversations with members, interested parties and media across Europe about digital privacy. The Initiative would like to see Google take this investigation seriously by cooperating with the CNIL, working on behalf of Europe’s citizens to protect their privacy and personal data.

UPDATE, 27 February 2013:

The CNIL has today expanded on an earlier announcement that it would be undertaking coordinated “repressive action” against Google “before the summer” by announcing that the company would be called to appear before a group of EU data privacy watchdogs “in the coming weeks” to answer for its failure to bring its privacy policies into line with European legislation despite being given ample time and opportunity to do so. ICOMP welcomes this decisive step to protect consumer privacy from the pernicious conduct of one dominant player in the online market. 

 

Regards,

The ICOMP Secretariat

Tags: , ,
Posted in Healthy Marketplaces, Online Advertising, Online Marketplace, Privacy, Search, Security | Comments Off

Consumers back privacy law action against Google

Monday, February 25th, 2013

Almost three quarters (71%) of Britons believe that data protection authorities were right to investigate Google’s privacy policies according to a new study by privacy campaign group Big Brother Watch. 66% of respondents went further than this, saying that national regulators such as the Information Commissioner’s Office in the UK should be doing more to force Google to comply with existing European directives on privacy. More generally, the poll indicates that 68% of respondents are concerned about online privacy with nearly a quarter “very concerned.”

The survey, which polled 2,050 British adults online, comes following a response deadline in the investigation by French watchdog the CNIL into Google’s decision to pool user data from all its services, including YouTube and Gmail. CNIL announced last week that Google had failed to provide “any precise and effective answers” as to how it will bring its policy into line with EU law.

In a much-noted response to this news, a Google spokesman last week replied: “Our privacy policy respects European law and allows us to create simpler, more effective services. We have engaged fully with the CNIL throughout this process, and we’ll continue to do so going forward.”

Big Brother Watch director Nick Pickles said: ‘The message from consumers is clear – regulators were right to investigate Google’s new privacy policy and now they need to do more to force the company to comply with the law. Online privacy is an important issue for a significant number of people and not enough is being done to address these fears.’

ICOMP has repeatedly emphasised the need for online services that give users the necessary trust by offering services that respect people’s privacy.  For Google to say that our privacy must be the cost of innovation is cynical and misleading. True innovation is fostered by a healthy and competitive online marketplace that takes user’s needs seriously, not by one that invades their privacy for monetary gains by a single monopolistic company. Google has consistently ignored this. Now is the time for the EU’s data protection authorities to take things in hand.

Tags: , , , , , , , , ,
Posted in Online Marketplace, Privacy, Search, Security | Comments Off

ICOMP Statement: What’s required for a successful settlement?

Friday, February 1st, 2013

“To be seen as a success, any settlement must include specific measures to restore competition and allow other parties to compete effectively on a level playing field.”

“Any settlement must include explicit acceptance by Google of its dominance and that it has damaged European businesses through its anti-competitive practices.”

David Wood, ICOMP Legal Counsel

ICOMP is pleased that Google has finally offered proposed actions to address its 90% plus dominant market share of Europe’s search and search advertising markets. However, we note that this is just the first step and, as Google’s previous attitude to both voluntary and binding commitments has shown, we need to be diligent in ensuring that these proposals are both effective and can be closely monitored to ensure compliance.

There are more than twenty formal complainants in this case from all sides of the online economy, including ICOMP and a number of its members. We all look forward to assisting the Commission in assessing Google’s proposed remedies, once they have been made public. However, in the meantime it is clear that for any settlement based on these proposals to be considered a success there are a number of criteria that must be satisfied.

In May 2012, Vice President Almunia outlined four areas of concern with Google’s practices and behaviour. It is clear that each of these must be fully addressed by Google’s proposals and under-pinned by measures that ensure enforceability and transparency.

In addition, Vice President Almunia has himself publically stated that he believes that Google is dominant and that “my conviction is they are diverting traffic [to their own service]”[1]. Any settlement must recognise and include explicit acceptance by Google of this dominance and that its actions as a dominant player have damaged European businesses through the use of anti-competitive practices.

Almunia has also stated on several occasions that rapidly restoring effective competition, not just ending anti-competitive practices is his goal. To be seen as a success, any settlement must therefore include specific measures to restore competition and allow other parties to compete effectively on a level playing field with Google in the key markets of search and search advertising.

This is essential in order to address not just current unlawful practices but also to ensure that Google is not allowed to profit from the fruit of its illegal behaviour.

1] As reported by the Financial Times 10th January 2013 http://www.ft.com/cms/s/0/42a827b2-5b24-11e2-8d06-00144feab49a.html#axzz2JTjv4xab

Tags: , , , , , , , , , , ,
Posted in Healthy Marketplaces, Legal Actions, Online Advertising, Online Marketplace, Search | Comments Off

Google’s submission: what happens next?

Friday, February 1st, 2013

Google has submitted a settlement offer to remedy the effects of its anticompetitive behaviour. What happens next?

Below is a simple flow-diagram which outlines the procedure we should expect to see the investigation following in the coming weeks.

Kind regards

ICOMP Legal Counsel

Tags: , , , , , , ,
Posted in Healthy Marketplaces, Legal Actions, Online Advertising, Online Marketplace, Search | Comments Off

« Older Entries