EU competition chief holds threat of breaking up Google

https://www.telegraph.co.uk/technology/2018/03/25/eu-competition-chief-keeps-threat-breaking-google-table/

by jonbaer • 8 years ago

78 85 8 years ago

telegraph.co.uk

dcgudeman• 8 years ago

Honestly comes across as EU sour grapes. The "competition chief" should focus on the regulations that have resulted in low investment and slow innovation instead of trying to "regulate" American tech companies.

jacquesm3• 8 years ago

You mean like VW being called out in the United States for the diesel scandal was US sour grapes?

Really, I'm all for symmetry with stuff like this if that is what it takes to get these giants to at least attempt to comply with the law.

adventured• 8 years ago

Symmetry was fining Google. The EU fined Google $2.7 billion.

What would symmetry look like from the US side if the EU starts demanding Google be broken up? Unfortunately the EU has no massive, powerful technology businesses to demand be broken up.

emiliobumachar2• 8 years ago

Were there other smoking gun cases of carmakers detecting emissions tests to alter car behavior?

matthewmacleod3• 8 years ago

Which regulations have "resulted in low investment and slow innovation"?

dmitrygr4• 8 years ago

High tax rate and difficulty of firing someone would be my two guesses

kuschku8• 8 years ago

Not regulations, incompatible regulations.

If you create a startup in SV, you can easily sell to the whole US.

In the EU, you’ll need to obey 28 different laws, 28 different standards, and file 28 different tax forms. This is currently the single biggest hurdle for startups in the EU.

The second, of course, is that people seem less willing to throw billions at risky concepts just so one maybe gets big enough.

tbirrell• 8 years ago

Does the EU even have the authority to break up Google/Alphabet?

ocdtrekkie6• 8 years ago

The EU effectively has the authority to decide who can do business in Europe. So Google/Alphabet presumably could refuse an EU breakup order, but they'd have to more or less exit business in Europe, including all of their various offices there. Both a lot of profit and talent left on the table.

Someone much smarter than me would likely have to determine whether stockholders benefit more from a split up company that can do business in Europe, or a unified company that can't.

Retric2• 8 years ago

The political backlash could make such a withdrawal rather temporary. Which would IMO push Google into staging such a withdrawal.

mehrdadn2• 8 years ago

What happens to people's emails in Gmail if they exit business in Europe? Surely people won't just be cool with their leaders making them lose access to their emails?

EDIT: I guess I didn't mean "what if Google was forced to do this overnight?", but rather I meant more like "couldn't Google make this backfire by doing this overnight?".

bluGill• 8 years ago

Probably not directly. Indirectly though that can do lots of things. Google will find it hard to sell ads if their salesmen are not allowed to physically enter the EU (and the ones currently in the EU are told their job is illegal - though how that works is an open question). In short the EU do lots of things to harass the EU operations until they decide they have to break up.

citilife• 8 years ago

I don't think they really can. Effectively, they'd have to block Google in the EU. Otherwise, Google can technically just stay in the U.S. and sell services. Ad's don't have to be location based, pretty sure a lot of advertising is elicit materials (such as porn) anyway - which already may not be allowed.

Unless you stop people from just heading to the top search engine in the world, they'll keep using it.

kuschku8• 8 years ago

There’s a simple trick known as asking the banks where Google keeps their money to freeze those assets.

LifeLiverTransp• 8 years ago

Blocking companys and growing ones own version of them, worked well for nearly every country who did it. (China, South Korea, Japan). Its a miracle the EU did this not earlier, and i guess Trumps punitive tariffs encourage dreams in some well-bribed politicians, to look for new sources of income by growing there own it-giants.

kokx2• 8 years ago

There are several things the EU can do. First of all, they can freeze and/or seize Google's assets in Europe. Like bank accounts and real estate. Or even more important to Google, all of their European datacenters.

The EU can also disallow sales of Google's products, like any android phone. Or products like the chromecast, and don't forget Nest and Google Home.

And selling ads in Europe from a foreign country isn't too easy either. It is a lot harder to do business with a company which is on the other side of the ocean, and officially doesn't have a precense in the same economic area.

If Google leaves all of that behind in Europe, and is not really allowed to do business in Europe anymore, soon enough there will be a competitor that stands up and can do things better. Especially if they can actually open offices in Europe and do business without major hurdles.

takeda• 8 years ago

I say that blocking google in EU would actually be a good thing for a consumer. It would force people to try out alternatives (which do exist).

Google currently has a monopoly for search, email, maps (and many other services which I care less about) it is crazy that we allowed it to happen.

It's not too far fetch that Google pretty much owns the internet. If Google blocks you or your company you might as well not exist.

There never should be a single entity that has so much power.

dragonwriter2• 8 years ago

The EU has the authority to break up the Alphabet subsidiaries (including indirect subsidiaries) operating in the EU, and the authority to require a breakup as condition of allowing any of the rest of Alphabet to do business in any form in the EU.

cryptonector• 8 years ago

It can ban them from operating in the EU unless they break up. The U.S. can also just break them up without a threat of banning them to get there. But certainly the EU have plenty of leverage.

csomar4• 8 years ago

I can understand the hatred many people here have toward Google, Facebook or other big gigantic life-controlling entities.

The step to remove Google dominance is to find, create and nurture alternatives. For example, I started using Fastmail. I'm using some of Apple products like the Calendar and Notes. I'm using Skype for communication.

So I'm diversifying a bit though they can engage in data sharing. This reduces the monopoly power of one single entity.

Blocking Google, Facebook or another big provider will not work and if it did, it can have severe consequences. Most people (and politicians) are ignoring the massive productivity benefits that Google search is bringing. It can be used for evil, but the productivity it brings is paramount.

You can't fight Google by blocking it or destroying it. There is a reason that Google is huge: It is magical and there is no usable alternative.

To remove Google monopoly you did what Google did for Yahoo or Bing: You build an alternative. It is possible to have multiple alternatives for search like for email or smartphones (though we have only two).

The reason we don't? Google won. Android/iOS won. Linux/Windows won. Everybody gave up and just accepted it. Now everyone is screaming of "regulating" these guys. Trust me. This how you get closer to your demise (politicians and current day governments) than to their demise.

simion3142• 8 years ago

Why not apply the existing rules against monopolies and anti competitive actions, what changed since Microsoft almost was broken up?

IMO is not competitive to have Google with it's advertising money get involved in 10 or more different activities and killing the companies that were or would have appeared there just because they have money and can run without profit.

nerfhammer• 8 years ago

Because it's not actually a monopoly. Monopoly means no competition. "Monopoly" just means "big" now apparently.

majormajor• 8 years ago

Could you elaborate on why you see it irreplaceable? I don't see how that reconciles with your personal examples of alternative tools?

I, similarly, use Apple Maps more than Google Maps now, Messenger or iMessage more than Hangouts, and don't feel like things would be too terrible if I had to go further into Outlook.com or iCloud instead of Gmail/Calendar... Google's versions are better but not in a way that seems magical or impossible to replace (from my experience with my work email/calendar in Outlook).

csomar4• 8 years ago

I actually found most of Google tools to be sub-bar. I only use Google search and I find that irreplaceable.

ubernostrum• 8 years ago

The step to remove Google dominance is to find, create and nurture alternatives.

Until Google's search results page for what you want to do decides to "promote" Google's own solution and "penalize" the competitor.

Which is something Google already does. They claim to have only the best and purest and most angelic of intentions, but the result is still strongly anti-competitive behavior and makes competing with Google a task that ranges from merely "obscenely difficult" all the way up to "actually impossible".

zapita2• 8 years ago

"I can understand the hatred many people here have toward Standard Oil or other big gigantic life-controlling entities.

The step to remove Standard Oil dominance is to find, create and nurture alternatives. For example, I started buying petroleum from a small independent refiner. I'm using some of Royal Dutch Oil Company products like their lubricants and ointments. I'm using whale oil for indoor lighting.

So I'm diversifying a bit though they can engage in price fixing. This reduces the monopoly power of one single entity.

Blocking Standard Oil, Royal Dutch or another big provider will not work and if it did, it can have severe consequences. Most people (and politicians) are ignoring the massive productivity benefits that Standard Oil is bringing. It can be used for evil, but the productivity it brings is paramount.

You can't fight Standard Oil by blocking it or destroying it. There is a reason that Standard Oil is huge: It is magical and there is no usable alternative.

To remove Standard Oil monopoly you did what Standard Oil did for the Cleveland or Pittsburg cartels: You build an alternative. It is possible to have multiple alternatives for oil like for steel or railroads (though we have only two).

The reason we don't? Standard Oil won. Carnegie Steel won. North Pacific won. Everybody gave up and just accepted it. Now everyone is screaming of "regulating" these guys. Trust me. This how you get closer to your demise (politicians and current day governments) than to their demise."

jadedhacker3• 8 years ago

Those Rockafellers are doing just fine even today after Standard Oil was broken up.

In telecommunications, the Baby Bells are doing just fine after the Bell Telephone Co. was broken up. They're just as monopolistic, price fixing, and destructive to privacy as ever.

joejerryronnie• 8 years ago

Vestager is using the bully pulpit of an EU commissioner to further her political ambitions and it is already starting to grate on her allies in the EU. She is beginning to significantly overstep her bounds and is risking a powerful backlash. Right now, everyone is blaming big tech for all the world's ills, and she is jumping on the bandwagon. But the public is very fickle. If the American and European populists realize the potential to paint Vestager as the poster child for elite globalism and really start to nitpick at her inconsistencies and political ambitions, she will not only have given Trump some very real ammunition for further US/EU conflict but may sow the seeds for additional internal EU strife.

Nokinside• 8 years ago

EMEA region brings roughly 30% of the revenue for Alphabet. EU alone probably 25% of that. US is 47%.

For a company that benefits from network externalizes a much as Alphabet does, revenue alone is not good measure of market importance. Losing one market means that market share in all markets is threatened and company growth is in peril.

In practice EU probably will not explicitly demand company break up. They wold create conditions that effectively break up the company inside EU. It's up to the owners to decide how they arrange it in the practice.

First Alphabet might have to choose what its main business is (= search) then all other businesses and services are separated from the search into different entities when they operate inside EU or serve customers inside EU. This would include Google Play, Youtube, Android, user accounts, ad placements, and ad sales generated from the EU.

This would break the platform synergy. Negotiators might leave carrots that make it easier for Alphabet preserve it's stock valuation if it rolls over and yields to most demands.

yuhong• 8 years ago

https://www.nytimes.com/2017/08/30/us/politics/eric-schmidt-...

I wonder if this contributed to Eric Schmidt leaving.

EU competition chief holds threat of breaking up Google

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