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Google battles £7 billion lawsuit over search dominance in UK

Google is facing a billionaire lawsuit in London as Alphabet, its parent company, asked a tribunal to dismiss claims accusing the tech giant of abusing its dominance in the online search market. The lawsuit, which could amount to £7 billion ($9.3 billion), focuses on businesses’ costs when using Google’s search advertising services, which plaintiffs argue are ultimately passed on to consumers. The legal challenge is one of several targeting Google’s practices in recent years, including a similar case in Britain concerning its advertising market dominance and an ongoing antitrust trial in the United States.

Consumer rights advocate Nikki Stopford, representing the class of claimants, argues that Google’s overwhelming market presence allows it to increase costs unfairly. Her lawsuit also points to a €4.5 billion fine imposed by the European Commission in 2018 over Google’s restrictions on Android manufacturers, a decision currently being appealed. Furthermore, the lawsuit accuses Google of striking a deal with Apple to make its search engine the default on Apple’s Safari browser in exchange for a portion of mobile search ad revenues.

Google has dismissed these claims as unfounded. Its lawyer, Meredith Pickford, stated that the case is flawed, rejecting the notion that Google’s practices harmed consumers. Pickford also emphasised that Google’s agreement with Apple was legally sound and argued that the European Commission’s ruling was based on technicalities rather than substantive issues. The tribunal’s decision on whether the case will proceed to trial remains pending.

Google overturns €1.49 billion antitrust fine in EU court

Google secured a significant victory on Wednesday, overturning a €1.49 billion ($1.66 billion) fine imposed by the European Commission in 2019. The fine, levied over antitrust violations, accused Google of abusing its dominance in online search advertising by restricting websites from using advertising brokers other than its AdSense platform. These practices, deemed illegal by the Commission, were said to have spanned from 2006 to 2016.

The General Court of Luxembourg, while agreeing with most of the European Commission’s findings, annulled the hefty fine. The judges ruled that the Commission had not fully considered all factors, particularly the duration of the unfair contractual clauses, which played a critical role in overturning the penalty. Despite the annulment, the ruling upheld many of the Commission’s assessments, but the financial punishment did not hold.

The fine was one of three that have cost Google a combined total of €8.25 billion in antitrust penalties, triggered by complaints from rivals such as Microsoft. Google noted that it had already revised the contracts in question in 2016 before the Commission’s decision.

The legal victory for Google comes just a week after it lost a separate case involving a €2.42 billion fine for unfairly promoting its price comparison service. While the battle over its advertising practices may have seen a favourable outcome, the tech giant’s ongoing legal challenges in Europe reflect the broader scrutiny facing major digital platforms across the continent.

White House eyes clean energy for AI expansion

A new task force has been launched by the White House to address the growing demands of AI infrastructure. Led by the National Economic Council and the National Security Council, the group aims to balance AI development with national security, economic, and environmental goals. Senior US officials and executives from major technology companies, including OpenAI and Google, took part in the meeting on Thursday.

The focus of the discussion was on the power requirements for advanced AI systems. Leaders explored how to meet clean energy targets and infrastructure needs, particularly in the face of increasing demand from data centres. AI has raised both hopes for efficiency gains and concerns over potential misuse, with its energy consumption being a significant challenge.

The Biden administration is pushing tech firms to invest in eco-friendly power solutions. The AI industry’s energy needs could complicate the government’s ambition to decarbonise the power grid by 2035. Representatives from major agencies, including Energy Secretary Jennifer Granholm, were part of the conversation on tackling these issues.

AI infrastructure plays a crucial role in the future of the US economy, according to OpenAI. The company emphasised the importance of expanding data centres domestically, not only to support industrial growth but also to ensure that AI’s benefits reach all corners of society.

European Commission unveils comprehensive plan for transforming telecom sector and enhancing digital infrastructure

European Commission recommendations from Mario Draghi’s report focus on transforming the telecom sector through regulatory and financial reforms. The report advocates for easing mergers and acquisitions (M&A) to enable market consolidation, expected to drive economies of scale and enhance investment capacity.

It also proposes redefining telecom markets at the EU level and standardising spectrum licensing rules to improve efficiency and competition across Europe. These changes aim to create a more robust and innovative telecom environment that can better meet the demands of the digital age.

In addition to telecom sector reforms, the European Commission report highlights the need for ‘commercial investment sharing’ to address the financial impact of high data traffic from major tech firms. It suggests that large online platforms, such as Amazon and Google, should contribute to the costs of telecom infrastructure investments. That proposal seeks to balance the burden on telecom operators with the benefits derived from these tech giants’ extensive use of their networks. By implementing this approach, the report aims to ensure that the costs of maintaining and expanding network capacity are more equitably shared.

Furthermore, the European Commission outlines strategies for advancing digital infrastructure and technology. The report calls for creating an EU-level body to develop uniform technical standards for network APIs and edge computing. It also recommends expanding high-performance computing (HPC) resources and investing in AI through public-private partnerships. These measures are designed to enhance Europe’s technological capabilities and foster innovation. Additionally, the report emphasises the need for sovereign cloud solutions and reducing dependencies on non-EU tech providers by boosting domestic production in critical areas such as semiconductors. These initiatives aim to strengthen Europe’s digital infrastructure and ensure a more resilient and competitive tech ecosystem.

Former Google exec reveals giant’s strategy to crush ad rivals

In 2009, Google’s goal was to ‘crush’ rival ad networks, as revealed by a former executive in a point highlighted in the ongoing US Department of Justice antitrust trial against the tech giant. The remarks, made by David Rosenblatt, Google’s former president of display advertising, surfaced as part of the prosecution’s argument that Google has been trying to monopolise the online adtech market, dominating both publisher ad servers and advertiser ad networks.

The trial is gaining momentum and has introduced evidence of Google’s internal strategies since it acquired DoubleClick in 2008. Rosenblatt’s comments, referenced in court notes, underscored Google’s aim to control the digital advertising ecosystem. He compared the company’s adtech ambitions to those of major financial institutions, stating that Google wanted to achieve in display ads what it had already done with search ads.

Google has denied the allegations, asserting it faces strong competition from other major players like Microsoft, Amazon, and Meta. The company argues that its advertising tools are common in the industry. However, the prosecution contends that Google’s integrated ad services give it an unfair advantage, particularly by making it difficult for publishers to switch platforms, a challenge Rosenblatt described as a ‘nightmare.’

Should the court rule against Google, prosecutors have called for the company to sell off its Google Ad Manager, including its publisher ad server and ad exchange, to restore competition in the digital advertising market.

EU scrutinises Google over AI model data use

Ireland’s Data Protection Commission (DPC), the leading privacy watchdog for many US tech firms in the EU, is investigating Google’s handling of user data. The inquiry will examine whether Google sufficiently protected the personal information of the EU citizens before using it to develop its advanced AI model, Pathways Language Model 2 (PaLM 2). The investigation is part of a broader effort by the DPC, working alongside other EU regulators to ensure compliance with data protection laws, especially in developing AI technologies.

Why does this matter?

The investigation is the fruit of growing concerns in the EU over how tech giants handle personal data, particularly in the context of AI, which relies heavily on large datasets. The DPC’s inquiry into Google’s data practices follows a recent agreement by social media platform X (formerly known as Twitter) not to use personal data from the EU users for AI training without first offering them the option to withdraw consent.

EU court rules against Apple’s tax deal and Google’s market practices

In a significant victory for European regulators, the EU’s top court upheld rulings against Apple and Google, marking key moments in the ongoing battle against Big Tech. Margrethe Vestager, the EU’s antitrust chief, has been at the forefront of efforts to challenge multinational companies benefiting from tax deals and engaging in anti-competitive behaviour. On Tuesday, the courts sided with her in two major cases involving Apple’s tax deal with Ireland and Google’s market practices.

The Apple case, which dates back to 2016, revolved around 13 billion euros ($14.4 billion) in back taxes. The European Commission argued that Apple’s arrangement with Ireland allowed the tech giant to pay an artificially low tax rate, at times as low as 0.005%. The Luxembourg-based Court of Justice agreed, confirming that Apple had received unlawful state aid and Ireland must recover the amount. Apple expressed disappointment, arguing that its income had already been taxed in the US and that the EU was attempting to change the rules retroactively.

Ireland, too, had challenged the ruling despite benefiting from the corporate taxes of large tech companies. The country’s low tax rates had attracted giants like Apple to establish European headquarters there. However, in a shift that signals broader changes in global tax policy, Ireland has since agreed to align with new international tax standards, even though its multinational tax take continues to grow.

On the same day, the European Court also ruled against Google in a separate antitrust case. In 2017, the European Commission fined Google 2.42 billion euros for abusing its market dominance by promoting its shopping service over smaller European rivals. Google appealed the decision but was met with a firm rejection. The court ruled that Google’s practices were discriminatory and did not constitute fair competition on the merits. Google, like Apple, voiced disappointment with the decision, though it claimed to have changed its business practices since the original ruling.

The ruling adds to the 8.25 billion euros in antitrust fines Google has accumulated in Europe over the past decade. The company continues to face scrutiny, with ongoing cases related to its Android operating system and AdSense advertising platform and an investigation that could lead to selling parts of its adtech business.

Why does this matter?

The decisions against Apple and Google reflect a broader movement within Europe to challenge the power of Big Tech. These cases are part of a growing trend where governments seek to hold multinational companies accountable for their tax practices and market behaviours. Other major corporations, such as IKEA and Nike, are also under investigation for their tax arrangements as regulators across the globe attempt to reshape the corporate landscape and foster a fairer competitive environment.

Google loses appeal over €2.42 billion EU fine

Google has lost its appeal against a €2.42 billion fine imposed by the EU over antitrust violations. The European Commission initially penalised Google in 2017 for giving its price comparison service an unfair advantage over smaller competitors. Despite challenging the decision, the Luxembourg-based Court of Justice of the EU upheld the ruling, emphasising that while dominance is not illegal, its abuse to hinder competition is prohibited.

The fine is part of a larger pattern for Google, which has faced fines totalling €8.25 billion over the last decade for various antitrust violations. Two additional cases involving Google’s Android system and AdSense are still pending decision. At the same time, a separate investigation threatens to force the tech giant to sell off part of its advertising technology.

The ruling highlights the EU’s firm stance on competition as regulators continue to scrutinise the practices of dominant tech companies like Google.

US DoJ takes Google to court over monopoly

Google is facing another antitrust battle in a Virginia court, where the US Justice Department has accused the tech giant of monopolising the online advertising industry. Prosecutors argue that Google controls the infrastructure that handles hundreds of thousands of ad sales each second, using its size and dominance to push out competitors and restrict customer choice.

The trial, which US District Judge Leonie Brinkema is hearing, focuses on claims that Google acquired rivals and manipulated market transactions to gain control over both advertisers and publishers. The government’s case highlights how Google allegedly stifled competition and locked customers into its products, tactics reminiscent of traditional monopolies.

Google’s defence, led by attorney Karen Dunn, refuted the accusations by arguing that the case is based on outdated market conditions. She noted that Google now faces significant competition from other major tech companies like Amazon and Comcast and that its tools have evolved to work alongside its rivals.

As the trial progresses, prosecutors push for Google to be forced to sell off essential parts of its ad business, including Google Ad Manager. The case is part of a broader effort by US authorities to curb the dominance of Big Tech, with other lawsuits targeting companies such as Apple, Meta, and Amazon.

UK regulator accuses Google of abusing ad market power

The UK’s antitrust regulator, the Competition and Markets Authority (CMA), has accused Google of abusing its dominant position in digital advertising, restricting competition in the sector. According to the CMA, Google’s practices, which allegedly favour its ad exchange platform, have hurt British publishers and advertisers, impacting their ability to generate revenue through digital ads. The regulator’s provisional findings suggest that Google has been using its influence in the advertising market’s buying and selling sides since 2015.

The CMA highlighted the potential harm these practices could cause businesses relying on online ads to fund their websites and apps, reaching millions across the UK. Juliette Enser, interim executive director of enforcement, stressed that this anti-competitive behaviour undermines free or lower-cost digital content. In response, Google disagreed with the CMA’s conclusions, arguing that its advertising tools support businesses of all sizes in a highly competitive industry.

The issue is part of a larger global scrutiny of Google’s advertising practices, with similar investigations underway by the US Department of Justice and the European Commission. In 2023, the EU regulators even suggested that Google might need to sell parts of its adtech business, though the company dismissed this idea as disproportionate. The CMA is now set to review Google’s response before deciding on possible fines or other legal actions to end the infringement.