{"id":366886,"date":"2021-11-14T16:00:29","date_gmt":"2021-11-14T13:00:29","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/what-googles-e2-4-billion-appeal-loss-says-about-big-techs-business-models\/"},"modified":"2021-11-14T16:00:29","modified_gmt":"2021-11-14T13:00:29","slug":"what-googles-e2-4-billion-appeal-loss-says-about-big-techs-business-models","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/what-googles-e2-4-billion-appeal-loss-says-about-big-techs-business-models\/","title":{"rendered":"#What Google\u2019s \u20ac2.4 billion appeal loss says about Big Techs business models"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3daac2c2e84\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3daac2c2e84\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/what-googles-e2-4-billion-appeal-loss-says-about-big-techs-business-models\/#The_case_against_Google\" >The case against Google<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/what-googles-e2-4-billion-appeal-loss-says-about-big-techs-business-models\/#Big_tech_and_consumer_rights\" >Big tech and consumer rights<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#What Google\u2019s \u20ac2.4 billion <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>eal loss says about Big Techs business models<\/strong>&#8221;<\/p>\n<div>Google is being fined \u20ac2.4 billion (\u00a32.1 billion) for hindering competition in the EU after a 2017 decision has been <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/curia.europa.eu\/jcms\/jcms\/p1_3582315\/en\/\">upheld on appeal<\/a> by the <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/general\/\" data-internallinksmanager029f6b8e52c=\"3\" title=\"General\" target=\"_blank\" rel=\"noopener\">general<\/a> court of the European Union. This is a saga dating back over 15 years, in which the European Commission has been accusing the tech giant of using its search results to give preferential treatment to its comparison shopping service over those of competitors.<\/p>\n<p>The fine, of which a share will directly go <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.bloomberg.com\/news\/articles\/2021-07-01\/google-eu-court-defeats-could-help-u-k-net-2-1-billion-bonus\">to the UK<\/a> by virtue of the EU withdrawal agreement, is also a vindication of the long fight against big tech by competition commissioner Margrethe Vestager. She suffered a crushing defeat in July 2020 when the <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.bbc.com\/news\/business-53416206\">same court overturned<\/a> a \u20ac13 billion fine imposed on Apple for an elaborate \u2013 but legal \u2013 tax avoidance scheme.<\/p>\n<p><iframe loading=\"lazy\" src=\"https:\/\/fast.wistia.net\/embed\/iframe\/yr3vae8jp4?videoFoam=true&amp;autoPlay=true\" title=\"\" allowtransparency=\"true\" frameborder=\"0\" scrolling=\"no\" class=\"wistia_embed\" name=\"wistia_embed\" allowfullscreen=\"\" msallowfullscreen=\"\" width=\"100%\" height=\"100%\"><\/iframe><\/p>\n<p>But this time, the tide has turned and the message is clear: the regulators will not allow Google and its fellow tech giants to steer consumers towards their own products. They may now have to re-think their entire business models as a result. The internet as we know it \u2013 in which most services are free to use but consumers pay by giving away their private data \u2013 may come to an end.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_case_against_Google\"><\/span>The case against Google<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.wired.co.uk\/article\/fine-google-competition-eu-shivaun-adam-raff\">Everything started<\/a> in 2005 when a British couple, Adam and Shivaun Raff, developed Foundem, a new service for comparison shopping. Google had its own comparison service named Froogle (now Google Shopping), although by its <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/ec.europa.eu\/commission\/presscorner\/detail\/en\/IP_17_1784\">own admission<\/a> in 2006 in an internal document, it \u201csimply doesn\u2019t work\u201d.<\/p>\n<p>Foundem found itself demoted from Google\u2019s search results. Unless you specifically searched for it, it would only appear after several pages of browsing. Without consumers redirected from the dominant search engine, Foundem never really took off.<\/p>\n<p>Having suspected that Google was restricting competition, Adam and Shivaun Raff attempted to convince the company to allow them some visibility. In 2009, they gave up and brought a complaint to the European Commission against Google for abuse of dominant position.<\/p>\n<p>Over the years, several other comparison services such as Expedia and Yelp joined the complaint. They had also attempted to compete with Google, only to see their websites suddenly relegated to the bottom of the search results by the dominant search algorithm.<\/p>\n<p>Then Google competitors in other markets started accusing the American company of anti-competitive practices. <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.bbc.co.uk\/news\/technology-44858238\">One complaint<\/a> was about Google forcing the pre-installation of free Google software on Android phones, for example. <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/ec.europa.eu\/commission\/presscorner\/detail\/en\/ip_21_3143\">Another was<\/a> about Google forcing advertisers to use the company\u2019s services if they wanted to take out ads on <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">YouTube<\/a>. In all, Google is fighting a <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.politico.eu\/article\/google-shopping-europe-fine-antitrust-margrethe-vestager-competiton\/\">long series<\/a> of similar cases on appeal against the commission.<\/p>\n<p>This is where Google\u2019s fine over Froogle becomes really serious. It is far from being the largest imposed by the European Commission, but it may be the most consequential because the upcoming appeal cases are likely to use this one as a precedent.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Big_tech_and_consumer_rights\"><\/span>Big tech and consumer rights<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Internet companies like Facebook and Google get their revenue by monetizing the data of their customers to show them search and display advertising that is relevant to them. They build an estate of companies \u2013 for example Google Search, Google Maps, Google Shopping, and YouTube \u2013 and try to make sure that when consumers leave one service they stay in the estate.<\/p>\n<p>The estate of Google is called Alphabet, and <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.cnbc.com\/2021\/05\/18\/how-does-google-make-money-advertising-business-breakdown-.html\">80% of<\/a> Alphabet\u2019s revenue comes from Google ads. The problem arises when a company like Google tries to keep consumers on their estate by hindering competitors.<\/p>\n<p>Google and other tech giants know almost everything about us because they gather information from so many different sources. The logic of the current judgment is that those sources should work as separate entities.<\/p>\n<p>In the future, your Google Maps or flight comparison experience may not use the information Google owns about you, or alternatively, the company would have to share the data with competitors. At the same time, Google may not be able to pre-install any of its services on Android phones and may be forced to give consumers a fair choice of alternatives to Gmail, Maps, or YouTube.<\/p>\n<p>This case also confirms divergent approaches to competition policy in the EU and US. The main objective of competition policy, both in the US and Europe, is to protect consumers.<\/p>\n<p>But in the US, the competition authorities concluded <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/public_statements\/statement-commission-regarding-googles-search-practices\/130103brillgooglesearchstmt.pdf\">in a similar case<\/a> in 2013 that the behavior of tech giants does not hurt consumers. <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/onlinelibrary.wiley.com\/doi\/full\/10.1111\/1756-2171.12298\">Their intuition<\/a> was that what makes Google rich is what makes consumers happy, that consumers do not mind handing their personal data to this company as they get tailored advice in exchange.<\/p>\n<p>Of course, it may seem that consumers do not care about giving away privacy simply because they are not aware of how much Google knows, and of how much money they make out of their data. For instance, when people started to notice that what is now called Meta, the estate of Facebook, was looking for ways to earn money from WhatsApp users, <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.theguardian.com\/technology\/2021\/jan\/24\/is-it-time-to-leave-whatsapp-and-is-signal-the-answer\">it caused<\/a> quite a stir.<\/p>\n<p><span><\/p>\n<figure>\n<p><iframe loading=\"lazy\" title=\"Meta! Watch Zuckerberg reveal Facebook&#039;s new name\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/KIxPRwgXFQg?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/p>\n<\/figure>\n<p><!--resp-video-container--><\/span><\/p>\n<p>European regulators have taken a radically different approach. Their reasoning dates back two decades since they <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/ec.europa.eu\/commission\/presscorner\/detail\/en\/IP_04_382\">first fined<\/a> Microsoft for pre-installing Media Player and Internet Explorer with the then-dominant operating system Windows 95.<\/p>\n<p>The same essential objection has now been applied to Google. By blocking competitors from entering the market, consumers lose the benefit of potential innovations. <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.sciencedirect.com\/science\/article\/pii\/S0167718721000023\">With that logic<\/a>, we enjoy the free services of Google simply because we have no idea how much better the alternatives could be if they got a chance to develop.<\/p>\n<p>The general court of the European Union has vindicated the view of the European Commission that Google\u2019s behavior is anti-competitive. Google may try to appeal to the European court of justice, but the general court\u2019s verdict is likely to remain the guiding principle for the years to come, with major consequences for consumers.<\/p>\n<p>If tech giants cannot earn money from their current business model, they may have to find other sources of revenue, either charging directly consumers or by creating <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.aeaweb.org\/articles?id=10.1257\/aer.20191330\">a more transparent system<\/a> in which consumers are aware of the value of their data and sell it freely. Whether the US will follow suit, and with whom the UK will choose to align if antitrust policies start to diverge radically across the Atlantic, are now the next big questions.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img decoding=\"async\" loading=\"lazy\" style=\"border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;\" alt=\"The Conversation\" width=\"1\" height=\"1\" class=\"js-lazy\" src=\"https:\/\/counter.theconversation.com\/content\/171628\/count.gif?distributor=republish-lightbox-basic\"\/><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: https:\/\/theconversation.com\/republishing-guidelines --><\/p>\n<p><noscript><img decoding=\"async\" loading=\"lazy\" style=\"border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;\" src=\"https:\/\/counter.theconversation.com\/content\/171628\/count.gif?distributor=republish-lightbox-basic\" alt=\"The Conversation\" width=\"1\" height=\"1\" class=\"\" srcset=\"\"\/><\/noscript><\/p>\n<p><em>Article by <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/theconversation.com\/profiles\/renaud-foucart-844157\">Renaud Foucart<\/a>, Senior Lecturer in Economics, Lancaster University Management School, <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/theconversation.com\/institutions\/lancaster-university-1176\">Lancaster University<\/a><\/em><\/p>\n<p><em>This article is republished from <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/theconversation.com\">The Conversation<\/a> under a Creative Commons license. Read the <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/theconversation.com\/google-loses-appeal-against-2-4-billion-fine-tech-giants-might-now-have-to-re-think-their-entire-business-models-171628\">original article<\/a>.<\/em><\/p>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more like this article, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/technology\/\" target=\"_blank\" rel=\"noopener\">Technology category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/thenextweb.com\/news\/googles-appeal-loss-says-about-big-techs-business-sydnciation\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;#What Google\u2019s \u20ac2.4 billion appeal loss says about Big Techs business models&#8221; Google is being fined \u20ac2.4 billion (\u00a32.1 billion) for hindering competition in the EU after a 2017 decision has been upheld on appeal by the general court of the European Union. This is a saga dating back over 15 years, in which the&#8230;<\/p>\n","protected":false},"author":1,"featured_media":366887,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/img-cdn.tnwcdn.com\/image\/tnw?filter_last=1&fit=1280,640&url=https:\/\/cdn0.tnwcdn.com\/wp-content\/blogs.dir\/1\/files\/2021\/11\/Google-EU.jpg&signature=50ce70b49e63cf2e7cd033b342707e6a","fifu_image_alt":"","footnotes":""},"categories":[18],"tags":[],"class_list":["post-366886","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/366886","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=366886"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/366886\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/366887"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=366886"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=366886"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=366886"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}