EU files antitrust charges against Google

The European Commission filed antitrust charges against Google Wednesday, alleging that the company "abused its dominant position" in the Internet search market. The tech giant hit back, however, saying it will respond to the charges in the coming weeks.

In what it called a Statement of Objections, the European Union's executive arm said Google had "systematically" favored its own comparison shopping product in its general search results pages.

The EU's Competition Commissioner, Margrethe Vestager, who is in charge of competition policy, said she was concerned that Google had given an "unfair advantage" to its own shopping service, in breach of EU antitrust rules.

"Google now has the opportunity to convince the Commission to the contrary," she said in a statement Wednesday. "However, if the investigation confirmed our concerns, Google would have to face the legal consequences and change the way it does business in Europe."

A woman uses Google web search on a tablet computer.
Damien Meyer | AFP | Getty Images
A woman uses Google web search on a tablet computer.

The Commission also formally opened a separate antitrust investigation into Google's mobile operating system, Android.

"Smartphones, tablets and similar devices play an increasing role in many people's daily lives and I want to make sure the markets in this area can flourish without anticompetitive constraints imposed by any company," Vestager added.

'Strongly' disagrees

Responding to the commission's announcement, Google said in blog post that it "strongly" disagreed with the EU's statement of objections and would make its case in the coming weeks.

"While Google may be the most used search engine, people can now find and access information in numerous different ways -- and allegations of harm, for consumers and competitors, have proved to be wide of the mark," Google said.

"If you look at shopping -- an area where we have seen a lot of complaints and where we understand the European Commission will focus its Statement of Objections -- it's clear that (a) there's a ton of competition (including from Amazon and eBay, two of the biggest shopping sites in the world) and (b) Google's shopping results have not the harmed the competition," it added.

Google decline?

Google faces fines of as much as $6.6 billion if antitrust charges are proven, and could be forced to reshape its business in Europe.

One analyst warned that such penalties could potentially mark the start of Google's decline in Europe – and beyond.

"I think the entire tech industry, particularly those that compete with Google, are watching this with great interest," Patrick Moorhead, principal and principal analyst at Moor Insight and Strategies, told CNBC Wednesday.

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He warned that Google could become the next Microsoft – another huge tech company accused by the European Commission of abusing its dominant position in the market.

Microsoft was fined $794 million in 2007 – the largest ever fine handed out by the EU at that time - and ordered to divulge certain information about its server products and release a version of Microsoft Windows without Windows Media Player.

Analyst Moorhead said that Microsoft had never really recovered from that decision in Europe, and the same could happen to Google.