Legal experts have been a thorn in the side of Alphabet, and in particular the search engine giant Google, for quite some time. The tech company from the USA is regularly accused of abusing its market power. The German Federal Cartel Office has finally intervened and is now giving Alphabet special treatment. Thus, Google’s parent company is now being scrutinized particularly closely as part of the “extended abuse supervision”.
A frightening market power
Quietly, Google has built up such Internet dominance over the years that antitrust experts are nothing but terrified. The German Federal Cartel Office has now intervened in accordance with the “Act against Restraints of Competition” and begun a two-stage procedure. The first step is a determination of “extended abuse control” on the basis of suspected anti-competitive practices. According to the authority’s president, Andeas Mundt, the reason for the Bundeskartellamt was the fact that they had “identified an overriding cross-market significance of Google.”
Normal control mechanisms no longer possible
The Federal Cartel Office does not seem to be able to avoid the step of taking a closer look at Google’s activities. After all, the Internet giant has now acquired such great market power that the natural control mechanism of competition is simply no longer possible. Google’s dominance is, of course, more than evident in the area of search engines. A proud 80 percent of all search queries on the Internet run through Alphabet’s search engine. The whole thing goes hand in hand with the business of online advertising. After all, every company wants to appear in Google’s search queries. Everything is embellished with the feeling of free usability for the user. Unfortunately, many lose sight of the fact that Google earns money not through user fees, but through advertising partners. The users serve as valuable advertising testimonial.
Google is everywhere
What began with a search engine has now spread to the most diverse corners of the Internet and tech world. With Android, for example, Google has developed the world’s most widely used operating system for smartphones. With YouTube, on the other hand, the company operates the world’s most successful video portal. These are just two examples in which Google can earn lots of money by embedding advertising and enjoys gigantic market power.
The Federal Cartel Office is taking action
In fairness, however, it must be said that Google is not the only black sheep when it comes to exploiting a dominant position. Other U.S. tech companies such as Amazon and Meta are also a thorn in the side of the Federal Cartel Office, and rightly so. It is therefore hardly surprising that Andreas Mundt and his authority are planning to initiate proceedings against these two major companies as well. We are curious to see what the results will be at the end of the five years of monitoring.