Google offers “much better” EU search concessions

Google is close to settling a three-year antitrust probe by European regulators after it offered “much better” concessions to allay concerns over blocking rivals from internet search results, two sources said.

A settlement under the European Commission’s competition rules means that Google will escape a possible fine of as much as $5 billion or 10% of its 2012 revenue.

Google and the Commission are close to a deal and a decision is expected in the next few days or in a couple of weeks at the latest, a senior European Union official told Reuters.

A second person familiar with the matter confirmed the likely settlement.

A Commission spokesman declined to comment on whether or not a deal was close. “We are at a critical moment in the investigation,” he said.

“We don’t comment on rumors and speculation,” a Google spokesman said in a statement.

Much better proposal

The EU official said Google’s latest proposal, its third since EU Competition Commissioner Joaquin Almunia rejected an earlier offer as unacceptable, was “much better”.

It includes commitments from Google on how it treats rivals and how it uses content from other providers in future.

The Commission has said that Google may have favored its own products and services in search results at the expense of competitors.

Google submitted the new offer in mid-January, in essence building on its second proposal with no dramatic changes, the second source said.

In that offer, the US company said it would let rivals display their logos and web links in a prominent box, and content providers decide what material Google can use for its own services.

It would also make it easier for advertisers to move their campaigns to rival platforms such as Yahoo and Microsoft’s Bing.

EU regulators will not seek feedback from the 125 rivals, including Microsoft and third parties who commented on Google’s previous proposals as they have a clear idea of their thinking after the last two market tests, the official said.

Competition question

That is likely to anger Google’s competitors.

Complainants such as British price comparison site Foundem, German online mapping service Hotmaps and US online travel sites Expedia and TripAdvisor have said Google’s earlier concessions would only entrench its dominance, and that it would be better for regulators not to do a deal than end up with a flawed outcome.

Almunia and Google executive chairman, Eric Schmidt, who were both in Switzerland for the World Economic Forum last week, are in permanent contact, the official said.

Google’s success in escaping an EU sanction and fines mirrors a similar outcome with US antitrust regulators.

The Federal Trade Commission in January last year ended a 19-month investigation with just a mild reprimand against the company, saying it had not manipulated its web site results and disappointing rivals and critics.