The European Union did not come down all that hard on Google Inc (NASDAQ:GOOG) when it revealed its opinion of the company’s power in the Internet search market. The two parties are still awaiting a full settlement to the anti-trust case, but reports today suggest that they might be getting close to an agreement.
According to the BBC, the European Commission is hinting that Google Inc (NASDAQ:GOOG) may soon agree to a settlement that will put an end to the case. Google will have to make key concessions and change part of the way it does business in Europe in order to strike a deal with the governing body of the European Union.
The following is our rough coverage of the 2021 Sohn Investment Conference, which is being held virtually and features Brad Gerstner, Bill Gurley, Octahedron's Ram Parameswaran, Glenernie's Andrew Nunneley, and Lux's Josh Wolfe. Q1 2021 hedge fund letters, conferences and more Keep checking back as we will be updating this post as the conference goes Read More
Google is not a monopoly
The European Commission was supposed to investigate whether or not Google Inc (NASDAQ:GOOG) had enough power in the Internet search market to be considered a monopoly. The group seems to have landed closer to no than yes on the question, but found some of the company’s practices unattractive. It is some of those behaviors that Google is likely to have to agree to change in a settlement.
The case is still ongoing, but it is unlikely to be completely played out in court. The billions of dollars in fines that Google Inc (NASDAQ:GOOG) would have to pay if found guilty is likely too big a risk for the company. A settlement that the two parties can agree upon seems the Nash equilibrium in the case.
Competition Commissioner Joaquin Almunia told the continent’s parliament that “We have reached a key moment in this case. Now with significant improvements on the table, I think we have the possibility to work again.”
Google EU Settlement
Any Google Inc (NASDAQ:GOOG) settlement is likely to include a way for the company’s rivals to have a greater presence in its search results. The major criticism leveled at Google Inc (NASDAQ:GOOG) is that it uses its market power to further that power by suppressing results from rivals.
Google Inc (NASDAQ:GOOG) offered a large amount of changes earlier this year, but it was rejected by the company’s rivals. The settlement that could be announced any day now is likely to include even more sweeping changes that would allow the company’s rivals more space on Google search results, and more brand presence on Google pages.