SAN FRANCISCO: The antitrust case that Google faces is a bit of a complicated one. Obviously, the technology company is a major contributor not just in popular culture and personal communications, but Google is also at heart of future technologies too.
And despite years of legal wrangling and in some cases, multibillion-dollar fines, the companies have conducted their businesses virtually unchanged.
Microsoft paid $3.4 billion in fines to European regulators over a decade, but its Windows software did not lose its dominant position in personal computers. Intel is still appealing its antitrust case, which began 15 years ago, even as it has become more powerful than ever in PC chips.
And despite five years of scrutiny by European regulators, Google showcases its own services prominently, such as maps and reviews, in its search results.
In the formal antitrust charges filed on Wednesday, the European Commission complained only about the results of Google’s shopping searches, noting that investigators were examining other types of search. The agency also began an investigation into how Google bundles its apps with its Android smartphone software, an inquiry that also isn’t likely to reach a quick resolution.
“The remedy issues are great challenges for antitrust,” said Harry First, a law professor at New York University who has written a book about Microsoft’s antitrust troubles. “These companies are big and smart and they know their businesses better than the regulators do.”
The slow process of regulatory enforcement is often at odds with the speed at which tech companies must move, which means that even the $1.4 billion fine faced by Intel can seem like a tolerable cost of business to a company that has $14 billion in cash and liquid assets.
Antitrust issues are not the only legal challenges facing American tech companies in Europe. Regulators and lawmakers are reviewing low-tax arrangements granted to Apple in Ireland and Amazon in Luxembourg, and privacy watchdogs are looking into how Facebook protects people’s online data. Policy makers are also investigating whether American Internet platforms like Amazon have too much control over how Europeans gain access to online services.
Even if regulators do not require substantial changes in how these companies do business, all of these fights impose a cost. In addition to negative publicity, legal costs and possible penalties, the cases are a distraction, forcing companies to defend an existing business model to regulators when perhaps they should be abandoning it because of a changing market.
Rapidly changing technology — rather than regulatory pressure — has been far more important historically in weakening the dominance of big tech companies.
“All the successful firms in the PC and early Web businesses missed mobile or were late to it,” said Timothy Bresnahan, a professor of economics at Stanford who worked for the Justice Department on antitrust matters and has also consulted for Microsoft, Intel and Google over the years.
Microsoft and Intel, focused on PCs, both missed the rise of tablet computers and smartphones, allowing companies like Apple, Google and Qualcomm to become dominant players in mobile devices.
