regulators to escape huge fines linked to the way it runs its online
search business, the bloc's top antitrust official warned Wednesday.
"I concluded that the proposals that Google sent to us months ago are
not enough to overcome our concerns," Joaquín Almunia, the European
Union competition commissioner, told a news conference here.
Mr. Almunia said he had written to Eric E. Schmidt, the company's
executive chairman, "asking Google to present better proposals, or
improved proposals."
The comments are a significant setback for Google, which has put its
efforts into reaching a settlement with Mr. Almunia that would entail
minimal disruption to the advertising linked to search services that
delivers the vast majority of its revenue.
Google is especially strong in Europe, with more than 90 percent of
the Internet search market in some countries, compared with about 70
percent in the United States.
Google had no immediate response to Mr. Almunia's comments. But the
company has insisted in the past that its proposal addresses four
areas of concern that were raised by Mr. Almunia about its business
after he opened the inquiry in November 2010.
The announcement by Mr. Almunia on Wednesday did not come entirely out
of the blue.
When Mr. Almunia last spoke in detail about Google, in May, he
strongly hinted, after reviewing feedback from companies and
organizations involved, that the company would need to improve
proposals made by Google late last year to settle the case.
The feedback was solicited to see if, among other issues, the proposed
remedies addressed complaints that Google favored its own products in
search results.
One of the major proposals from Google was that it would show links to
the Web sites of competitors who offer specialized search services. In
cases where Google sells advertising adjacent to search results for
specific industries like restaurants and hotels, Google would provide
a menu of at least three options for non-Google search services.
In addition, Google offered to label results that pointed to its own
services — like Google Maps — as its own properties and separate them
from general search results with a box. Google's agreement would be
legally binding for five years, and a third party, approved by the
commission, would be put in place to monitor compliance.
Since May, Mr. Almunia has come under increasing pressure from Google
rivals to devise a tougher set of remedies than the package that was
made public in April.
Those rivals, including publishers, mapping and travel companies, have
published a slew of studies to show the ineffectiveness of the deal
that Google has offered so far.
"Google's proposed commitments across the board retard rather than
promote competition," Thomas Vinje, a spokesman for Fairsearch Europe,
a group of Google's competitors, including the cellphone maker Nokia
and the software titan Microsoft, said in a statement on Wednesday.
Mr. Vinje said that a survey his group had commissioned from two
professors at the University of Illinois and University of San
Francisco showed that Google's proposals would attract the vast
majority of searchers to the company's own products and discourage
them from visiting rivals.
Some rival companies have been pushing Mr. Almunia to demand solutions
that could force Google to place their sites at the top of the results
list in Google's engine, in order to reach consumers who click most
frequently on the first offering that they see.
"Google must be evenhanded," 11 organizations including TripAdvisor
and the Federation of German Newspaper Publishers wrote in a letter to
Mr. Almunia in March. Google "must hold all services, including its
own, to exactly the same standards, using exactly the same crawling,
indexing, ranking, display and penalty algorithms," they wrote.
A settlement with the European Union would allow Google to escape the
long, expensive antitrust battles that Microsoft fought in Europe over
its media player and server software during the past decade.
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