John Paczkowski

Recent Posts by John Paczkowski

EU’s Message: Anybody Else Feel Lucky?

dirty_harryThe European Commission’s announcement Wednesday of $732 million in sanctions against Microsoft is an inevitable and expected comeuppance for the software giant’s failure to comply with the terms of an antitrust settlement requiring it to offer consumers a choice of Web browsers.

But it’s also a warning to other companies with which the agency has regulatory issues — one in particular.

Google.

The EC has been investigating the search behemoth over its alleged dominance of the search market since 2010 and earlier this year squeezed a settlement proposal out of it. That proposal is said to be largely similar in content to the one Google agreed to with the U.S. Federal Trade Commission, though with a few more teeth. The EC hasn’t yet commented on the proposal, other than to confirm that it has received it, and it’s unclear whether it will demand more concessions still from the company.

What is clear, however, following the fines levied against Microsoft today, is that the EC is quite serious about demanding significant changes from companies that violate its antitrust laws and is entirely willing to drop the hammer on those that fail to follow through on them.

As EU competition commissioner Joaquín Almunia said today, “Legally binding commitments reached in antitrust decisions play a very important role in our enforcement policy because they allow for rapid solutions to competition problems. Such decisions require strict compliance. A failure to comply is a very serious infringement that must be sanctioned accordingly.”

A pat explanation for the EC’s sanctions against Microsoft, but also a clear “feeling lucky, punk?” warning to Google: Don’t make empty promises. Because the financial implications can be staggering: Fines of up to 10 percent of the company’s annual global sales. In Google’s case that’s potentially billions of dollars.


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