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Is Google undermining retailers?


Yesterday an EU investigation accused Google of damaging healthy business relations by pushing its own shopping service online.

Margrethe Vestager, EU Commissioner in charge of competition policy said:

"In the case of Google I am concerned that the company has given an unfair advantage to its own comparison shopping service, in breach of EU antitrust rules. Google now has the opportunity to convince the Commission to the contrary. However, if the investigation confirmed our concerns, Google would have to face the legal consequences and change the way it does business in Europe."

The search giant has been accused of artificially pushing its own shopping comparisons, while there is also concern over the business’ android operating system.

Google announced recently that a new “mobile-friendly ranking factor” will be used to ensure that retailers satisfy the increasing demand for mobile shopping. Websites not optimised for mobile will be penalised and listed much lower in the search results.

The news came after Google found that 50% of searches were on mobile, with Gareth Evans of digital agency Equator commenting:

“Mobile has changed the way we consume online content over the last few years and the majority of switched-on marketers have observed this trend and incorporated mobile into their overall strategy”.

Vestager agrees that smartphones and tablets are playing, “an increasing role in many people’s daily lives”.

However, Vestager goes on to add, “I want to make sure the markets in this area can flourish without anti competitive constraints imposed on any company”.

The concern over Google ‘misusing’ its position could lead to a trial and large fines for the business, as the company provides over 90% of general web searches in Europe. If the accusations are true this will have undermined many retailers selling online. 

Though Google has not yet responded, a blog post written by Amit Singhal, the Google Executive in charge of the search engine, spoke on the allegations before they were officially put forward. He believes that people have more choice than ever:

“There are numerous other search engines such as Bing, Yahoo, Quora, DuckDuckGo and a new wave of search assistants like Apple’s Siri and Microsoft’s Cortana. In addition, there are a ton of specialized services like Amazon, Idealo, Le Guide, Expedia or eBay. For example, Amazon, eBay, and Axel Springer’s Idealo are the three most popular shopping services in Germany”. 

Google has been given time to respond to the allegations.  

Published on Thursday 16 April by Rachel Gee

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