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Tuesday, November 26, 2013
Consumer Groups Oppose Google Antitrust Settlement

Consumer groups worldwide are opposed to a proposed deal to settle the European Commission?s antitrust investigation of Google.

Consumer Watchdog, a U.S.-based public interest group, filed comments late Monday night opposing a proposed settlement to the European Commission's antitrust investigation of Google because the proposed deal "will not restore a competitive search marketplace that will serve the interests of consumers."

Meanwhile, Monique Goyens, director general of BEUC, the European consumers' organization, had this comment about the settlement the Internet giant has proposed:

"It seems the Commission can't find what it is looking for with Google. Progress has been slow and piecemeal. This second round of proposals are actually not just inadequate to solve consumer detriment, but are in fact self-serving? Somewhat bizarrely they are trying to settle an antitrust investigation by suggesting a new revenue stream and continuing to marginalize concerns. We find this unacceptable. The Commission should not bend the knee just due to investigation fatigue and [because] their mandate ends in 2014."

Consumer Watchdog says that the internet giant "is taking advantage of its monopoly position in search to charge merchants more for placement in Google Shopping, causing higher prices for consumers."

Consumer Watchdog studied (PDF) product results returned through Google Shopping on the Internet giant?s Universal Search and compared prices for the same item listed on three competing comparison shopping engines (CSEs), Shopzilla, Pricegrabber and Nextag. Checking prices for 14 items this month, Consumer Watchdog found Google listings as much as 67 percent higher. In eight of 14 cases lower prices were available on a competing CSE, the study found.

"The problem is that the suggestions the settlement is built upon simply do not solve the underlying issue," Consumer Watchdog told the European Commission. "Moreover, Google's conduct has severely damaged competition, leaving consumers with less choice and facing higher prices."

Consumer Watchdog concluded Monday?s comments to the Commission:

"Google has developed a substantial conflict of interest. It no longer has an incentive to steer users to other sites, but rather to its own services. It is becoming even more effective at this and has a greater incentive to engage in manipulation now that it is merging data collected across all its services. The only way to deal with this conflict is to remove it. Consumer welfare is the ultimate test of any antitrust settlement. Google's proposed Commitments fail to meet this standard. Approval of the Commitments would essentially legitimatize Google?s anti-competitive practices and give the company more tools to strengthen its dominance."

The European Commission's antitrust watchdog last month gave Google's rivals a month in which to review the company's second proposal to settle an antitrust case.

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