Earlier report suggested that Google will be slammed with a $1.2 billion fine, but that seems far-fetched now. "It has harmed competition and consumers", EU Competition Commissioner Margrethe Vestager said.
The company holds a 90 per cent market share in Europe's online searches.
Probes were triggered after the European Commission received dozens of complaints from US and European competitors who claimed that the search engine company abused its search market dominance to give its Google Shopping service an advantage over other retailers and create a monopoly over consumers. "Google's illegal practices have allowed Google's comparison shopping service to make significant gains in traffic at the expense of its rivals and to the detriment of European consumers". The commission says this is illegal under the EU's fair play laws.
Google has hinted that it may appeal against the imposition of the mammoth fine - the biggest ever competition fine in history. "We will review the (European) Commission's decision in detail as we consider an appeal, and we look forward to continuing to make our case". "Google's own comparison shopping service is not subject to Google's generic search algorithms, including such demotions".
"When you shop online, you want to find the products you're looking for quickly and easily", a spokesman said in response to the ruling. This, obviously, puts those competitors at a disadvantage because - as the Commission points out - the first 10 results in a Google Search tend to attract around 95% of the clicks, with the first result usually taking around 35% of the clicks all on its own. Additionally, the Mountain View company has also been accused of blocking rival's ads in online searches.
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In addition to this fine, the Commission amount, Google will put an end to these practices deemed anti-competitive in 90 days, "without which it will be subjected to periodic penalty payments up to 5% of the average turnover of the business done on a daily basis at the global level by Alphabet, the parent company of Google". By giving this shopping tool priority, it's argued that Google has unfairly stifled competing comparison services.
The Commission noted in a statement that while market dominance is not illegal in the European Union, anticompetitive practices are, and the Commission said that Google's practices have contributed to a more than 80 percent drop in traffic to rival comparison shopping services.
Google had previously suggested that Amazon and eBay have more influence over the public's spending habits and has again said it does not accept the claims made against it. "It has prevented other companies from competing on the basis of their merits, and innovate".
"What has the potential to hurt Google and be far more damaging is what remedies the European Commission may or may not impose on Google as a result", Windsor said.
The commission said that since 2008, Google has systematically given prominent placement to its own comparison shopping service, while demoting rival comparison shopping services in its search results.