Google Inc (GOOG): Will Search Fixes Solve the EU Case Once and For All?

Google Inc (NASDAQ:GOOG) has been trying very hard to get in the good graces of the European Union’s Competition Commissioner, Joaquin Almunia, who is responsible for overseeing  business competition in the EU marketplace and crack down on antitrust violators. Google has been on the commission’s radar for a couple of years now with a couple of antitrust issues, but the most noteworthy has been its Google Search service, mostly because it has such a dominant positions in the search sector online in Europe.

There has been pretty consistent carping from other search engines as well as local EU businesses that have relied on search results to drive business, and Google Inc (NASDAQ:GOOG), with considerable market share north of 70 percent in Europe at last count, has had a lot of perceived control in those search results and essentially where business traffic gets directed. Thus is the rub, since Google owns several properties other than its search engine, and it has very valuable advertisers in place as well. The competition commission has been threatening sanctions aginst Google for its search reuslts being anti-competitive, and Google submitted some proposed remedies to the issues last month.

All of the affect stakeholders were asked to “test” these proposals over the next month – the deadline was yesterday for the test to be finished – and though the commission has allowed the test to continue for another month, the feedback received so far may just tell the commission that Google Inc (NASDAQ:GOOG) may not be going far enough – if going anywhere at all – to address the issues. According to some feedback from a British search engine, Foundem, the proposed fixes by Google might actually make things worse instead of better.

Google Inc (NASDAQ:GOOG) is under scrutiny or its search results because it notoriously places its own results (like YouTube links) higher on search results than anyone else, regardless of relevance – though search is supposed to present the most current, most relevant search results first. But because Google seems to have so much riding on its own properties and those of its partners, various EU business have been complaining that Google has squeezed out local businesses by pushing their results further down the first page or onto subsequent pages so they don’t get viewed as often. That, they claimed, has led to lost business for them and is anti-competitive in general.

What did Foundem claim about these new proposed “fixes”?

The British search engine, in its analysis of the proposed changes that Google Inc (NASDAQ:GOOG) would make to its search algorithm, claimed in a paper that if the measures were adopted, Google  would have the opportunity to force specialized services into paid placement to be high in search results. “As a result, pretty soon the only vertical search services not handing over most of their profits to Google would be Google’s own vertical search services,” the paper said.

What are your thoughts about this ongoing investigation? Should Google Inc (NASDAQ:GOOG) pay a price for its business model? Give us your thoughts in the comments section below.

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