Google fined $592 million for non-compliance by French antitrust regulators

Google faces fines and further scrutiny by French regulators

French antitrust regulators have given Google two months to pay a $592 million fine for disregarding injunctions related to French news publication negotiations.

Google has been accused of not acting in good faith in its negotiations with news agencies and publishers. The search giant also refused to have a specific discussion about paying for news content online.

According to CNN Business, Google must pay a $592 million fine over its failure to comply with regulator's demands. The fine is representative of what is owed as compensation to the publishers for their content.

"When the regulator imposes obligations for a company, it must comply scrupulously, in both the spirit and letter." the antitrust agency's chief Isabelle de Silva said. "In this instance, this was unfortunately not the case."

Google has been facing heavy scrutiny in France over anti-competitive practices in search and news publication. In June, the company was also fined $267 million for abusing market power in online advertising.

Google did not protest the first fine, but it has issued a statement in regards to the latest antitrust charge. The company says it is "very disappointed" with the decision.

"We have acted in good faith throughout the entire process," a Google spokesperson said in a statement. "The fine ignores our efforts to reach an agreement, and the reality of how news works on our platforms."

Plans to pay the $592 million fine will have to be proposed within two months, or Google will receive additional penalties up to $1.1 million per day. It is unknown if Google intends to protest the fine or pay it in full.

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5 Comments

red oak

said about 2 years ago

EU regulators are out of control bureaucrats with no business experience. Would not be surprised if Apple does pull out of one or more countries

Remarkable how the EU is unable to compete in tech, software or services on a world-wide scale. Regulation and fines are how it responds

KTR

said about 2 years ago

Freaking money gougers

jbdragon

said about 2 years ago

Why is Google playing this game? Just take off ALL the news and have zero news links and all is good instead of being fined all this money for this garbage.

Rayz2016

said about 2 years ago

Before anyone jumps in and says, “Good! Google deserve it!”, remember which company is next on the gouge pile.

Marvin

said about 2 years ago

jbdragon said:

Why is Google playing this game? Just take off ALL the news and have zero news links and all is good instead of being fined all this money for this garbage.

They can even replace all news links in France with a Rick Roll and a caption that says 'brought to you by the French government'. I'd like to see a company do that at some point and link to where the public can complain.

It's not as if the demands are even reasonable. This is apparently about Google using snippets of news in search results. That's how search results work and they are driving traffic to the publishers, people aren't using the snippets to avoid the sites.

I've noticed recently that more news sites have been putting up immediate blocks on news articles with popups for subscriptions. The news industry seems to be in a bad situation just now:

https://nypost.com/2021/07/13/google-fined-593m-in-france-amid-battle-over-news-publishing/
https://www.journalism.org/fact-sheet/newspapers/
https://www.journalism.org/2020/10/29/coronavirus-driven-downturn-hits-newspapers-hard-as-tv-news-thrives/
https://www.nytimes.com/2020/04/10/business/media/news-media-coronavirus-jobs.html

The established news sites are struggling to compete with the ad models and audience reach of Facebook and Google. The following article talks about how publishers getting deals with them wouldn't work long-term anyway:

https://www.businessinsider.com/facebook-google-paying-publishers-wrong-solution-media-ad-revenue-2021-1

This situation is an inevitable consequence of the internet but also that news agencies now report what's trending on social media, move more into trashy journalism and the backlash against privacy invading ad models, which promotes the use of ad-blockers. Mainstream news site now regularly publish popular TikTok videos. If they choose to become a middle-man to social media, they shouldn't act surprised when people cut them out of the loop.

This is another case of old-fashioned companies unable to compete and using legal means to bully modern companies into supporting them.

The ad revenue model will continue to reduce value per ad over time so as that last link suggests, they would be better off coming up with an alternative revenue model. I'm not sure there is one that will work though. What Apple does with Apple News+, a unified subscription across multiple publishers, is pretty much the only viable alternative that consumers will adopt and publishers don't get enough money from that either.

What normally happens in declining industries is job cuts and consolidation and I expect the news industry will continue down this route until it reaches a more stable point where what they are selling is at a price people are willing to pay. Bloomberg is an example that shows how out of touch some of them are:

They want $415 per year ($35/m) to read their articles now. I doubt someone would pay that for their yearly news from all publishers let alone a single publisher. Obviously they must be convincing some people to subscribe but this isn't a strategy that will work across the publishing industry.

The French news company Le Monde was reported to be one of the companies against Google, the following says they have a 9.90 euro/m subscription and mostly digital circulation around 400k subscribers:

https://amplitude.com/case-studies/le-monde
https://en.wikipedia.org/wiki/Le_Monde
https://www.acpm.fr/Support/le-monde

That's under 50m euros per year revenue. Clearly they just want big tech companies to bankroll their failing businesses but they can't sustain this forever. Governments could bankroll the news businesses but then they'd get into issues of censorship because they wouldn't be allowed to spend public money on certain content. They could do it via a 3rd party non-profit trust though. There can be a non-profit that gets donations from governments and private companies to support news sites and the amount they'd get would depend on the audience they have.