Google Is Target of European Backlash on U.S. Tech Dominance
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Version 0 of 1. BRUSSELS — A top German official called for Google to be broken up. A French minister pronounced the company a threat to his country’s sovereignty. A European publishing executive likened it to a Wagnerian dragon. Across Europe, Google has been under fire, reflecting the broader challenges facing American technology companies. Google, fairly or not, has become a glaring proxy for criticism of an intrusive American government and concern over America’s unmatched technology dominance. On Monday, things grew worse. Regulators pushed the company to give up more in an antitrust settlement — demanding that Google make additional changes to its secret sauce, the search algorithm. When Google initially settled with regulators in February, it emerged largely unscathed, agreeing to make modest adjustments to its search formula and avoiding a fine. Now, the deal is in jeopardy. If Google does not acquiesce, regulators could toss out the settlement and bring formal charges, which could prompt billions of dollars in penalties and major changes to its operations. The backlash in Europe extends beyond Google. Taxi drivers from London to Madrid have demonstrated against Uber, the American ride-sharing company that was recently banned in Germany. Apple and Amazon are being investigated over their tax policies, and regulators are scrutinizing Facebook’s proposed acquisition of WhatsApp, a messaging app. Google, with its broad reach, is arguably facing the most pressure. Accusations are mounting that Google unfairly exploits its dominant position in search, giving a competitive edge to its growing stable of businesses, like YouTube videos, its Google Play app store and its news alerts. A landmark European court ruling this year forced search providers to give the public greater sway in purging links to personal information. Its Street View cars, dispatched to scoop up data, have brought fines in France, Germany and Italy. “We are afraid of Google,” wrote Mathias Döpfner, chief executive of Axel Springer, a German publishing giant, in an open letter to Eric Schmidt, Google’s executive chairman. “I must state this very clearly and frankly, because few of my colleagues dare do so publicly.” The influence of Mr. Döpfner, who has rallied a group of publishers against the company, has risen after he played a crucial role in winning German support for Jean-Claude Juncker, the next head of the European Commission. Google has not been idle. While the company has stressed its efforts to negotiate with European regulators, it has also resorted to more familiar tactics. Since 2010, the company has tripled its lobbying budget in Brussels to as much as $2 million annually, according to public records. Google has hired political insiders, including Antoine Aubert, a former policy manager in one of the European Commission’s ministries. The company has also tapped at least four outside firms to bolster its own staff of seven registered lobbyists, records show. And Google has doubled the number of outside groups it has joined to advance its interests, with some, like the European Privacy Association, drawing criticism for a lack of transparency. “We continue to work with the E.C. to resolve the concerns they have raised,” the company said in an emailed statement about the antitrust settlement, referring to the European Commission. Over the weekend, Mr. Schmidt in a lengthy statement responded to criticisms made by European publishers, saying it is not true that “we are promoting our own products at the expense of the competition.” Much has changed since Google was founded in the late 1990s. It was once viewed as an idealistic start-up whose credo was “Don’t Be Evil.” Now, it is under attack around the globe. Over the last year, while its search engine business was being shut off by the Chinese government, its employee buses were assailed in the Bay Area as symbols of inequality and its Google Glass was drawing fire from privacy advocates. “They’re no longer seen as innocent geeks,” said Thomas Tindemans, the chief executive of Hill & Knowlton Strategies in Brussels. Perceptions in Europe have been gradually changing over Google’s dominance. The company commands about two-thirds of the United States search market, according to comScore, but close to 90 percent in Europe, excluding Russia. Anger over mass data collection by the American government has only amplified the concerns. Jérémie Zimmerman, a co-founder of the French Internet activist group La Quadrature du Net, said that when people told him now that they worked for Google, he says, “How do you like working for the N.S.A.,” referring to the National Security Agency. “Many users were lured by the convenience and comfort of the services,” he said, but he added that the revelations by the former N.S.A. contractor Edward J. Snowden revealed that Google was part of a “massive breach of our security, of our data and of our sovereignty.” Google, for its part, has denied being complicit in the spying and said it was taking steps to make it much more difficult for spy agencies to breach its systems. On another antitrust front, regulators have begun a preliminary investigation of the company’s Android operating system for cellphones and other mobile devices. They are examining many complaints from competitors like Aptoide, a Portuguese app store provider that says Google’s search results favor the Google Play app store. Other complaints have come from an association of photo libraries and a telecom company, claiming that Google skews search results. Digital privacy legislation is also advancing in Parliament. The legislation has accumulated more than 4,000 amendments, a record. Among the main proposals are restrictions on how companies like Google use personal data and requirements that they check with European officials before they comply with American subpoenas. “Google was an interesting start-up at the beginning and a helpful website, but that has dramatically changed,” said Jan Philipp Albrecht, a member of the Green Party who has been the leading legislator shepherding through the legislation. “For politicians in Europe, it’s clear they have to act and regulate the way Google dominates the market.” Trouble is stirring at the country level, too. In Germany, publishers are fighting in court over compensation for the “snippets of text” that appear with Google News updates. “Taken together, all these issues point to the pressing need for E.U.-wide common approaches to the challenges posed by Google and other players in the digital era,” Joaquín Almunia, Europe’s competition regulator, said in a speech this summer. “Their centrality for Europe’s economy and their pervasive presence in the lives of the vast majority of our fellow citizens are turning this into one of the defining domains of E.U. policy making.” Google’s competitors have created a cottage industry dedicated to bashing the company. Axel Springer and a number of other French and German companies banded together to form a group called the Open Internet Project, whose grandiose “Paris Declaration of May 15, 2014,” said “European consumers and digital entrepreneurs demand ban of Google’s manipulative favoring of own services and content.” Then there is Microsoft, Google’s longtime nemesis, which spends three times as much in Europe on lobbying and similar efforts. ICOMP, a Microsoft-backed group, has long targeted Google. “Google is clearly in the cross hairs,” said David Wood, a London-based partner at Gibson, Dunn, one of Microsoft’s law firms, and legal counsel at ICOMP. “A lot of the aura has faded, and the shine has come off, and people don’t think they’re the good guy anymore.” |