The European Commission has fined Google a total of EUR 890 million for favouring its own services on Google Search, and for steering consumers towards alternative channels on its own Google Play.
“We found that Google harms businesses offering similar services, such as shopping or sports, by not granting them the same level of prominence on Google Search”, said EC executive vice-president Henna Virkkunen: “We also found that Google has restricted app developers from offering cheaper offers to customers in the Google Play app store.”
Under the Digital Markets Act (DMA), so-called ‘gatekeepers’, the big Internet portals, must not treat their own services more favourably in ranking than third-party services. They have to apply transparent, fair and non-discriminatory conditions to such ranking.
The Commission found that Google gives preferential treatment to its own services, including shopping, hotels, transport and sports results, over those of third parties in Google Search, thereby breaching its obligations under the DMA.
Google displays its own services more prominently in search results, including at the top of the search results page or by using enhanced visuals and filters, while similar third-party services do not have the same prominence.
Also under the DMA, app developers that distribute their apps via Google Play should be able to inform customers – free of charge – of alternative, often cheaper, offers, and to direct them to those offers to make purchases, for example on websites or alternative app stores.
The Commission also found that Google failed to comply with that obligation.
In particular, Google prevents app developers from freely communicating and promoting offers and concluding contracts with users in distribution channels of their choice, including third-party app stores.
While Google can receive a fee for facilitating the initial acquisition of a new customer by an app developer via Google Play, the level of the steering-related fees charged by Google and the length of the charging period for these fees went beyond what is considered compliant with the DMA.
As part of today’s two decisions, the Commission has ordered Google to bring the non-compliance to an end.
Specifically, Google must implement measures to:
- Treat third-party services that feature on Google’s search results in a fair and non-discriminatory manner by reference to its own services, and
- Allow app developers distributing their apps via Google Play Store, both technically and contractually, to freely communicate, promote offers and conclude contracts with users not only within but also outside the Google Play app store.
Google has now proposed and started testing changes to how it presents its own services on Google Search for free services such as shopping, hotels and flights. The Commission says it will monitor the implementation of these solutions which it says constitute ‘substantial progress’ towards compliance. The Commission also notes that Google has proposed and started testing changes to how it presents shopping ads and content related services, such as sports. The Commission is currently assessing these changes and says it will continue its dialogue with Google in light of today’s decision. The Commission also takes note of Google’s proposals on how it plans to apply the principles of the decision to AI Overviews and AI Mode, on which dialogue will continue in light of today’s decision.
Google has rolled out changes related to Google’s steering terms. These constitute good progress towards compliance, says the Commission, and will also be assessed in light of the cease and desist order of today’s decision.
