Yelp, which employs more than 5,000 people in America, applauds the action of the European Commission to restore competition in the marketplace. Commissioner Margrethe Vestager has removed the straight-jacket Google has placed on innovation with Android. This enforcement action will unlock a potential for incredible benefit for consumers. For example, if a developer wants to have a direct relationship with an OEM and create superior experiences compared to what exists in the Android straight-jacket, they now have a viable path forward.
Ultimately, Google’s strategy of abusing its dominant position in smartphones is about protecting its dominance in search. In the US and Europe, Google has a staggering 98% market share of search on smartphones (this includes iPhone), where half of all searches have local intent. This allows them to put their thumb on the scale. For example, when a mother searches for a pediatrician in Berlin, instead of being matched with the most relevant information on the web, such as from native local review service Jameda.de, Google redirects that user into their in-house product — even though they concede it has less content and a lower ranking. (See this video for more depth on this point.) Google has never explained how this is better for the consumer (probably because they can’t).
This Google decision to ignore its meritocratic processes in favor of their own content causes direct, measurable consumer harm. In language Robert Bork would understand, in local search, consumer welfare is being diminished. Beyond denying consumers the best results from the entire web, Google’s design choices are choking off oxygen to a broad range of user generated content (UGC) services across the web, such as Wikipedia.
Given the unhealthy state of the open internet, Yelp believes it is time for renewed antitrust scrutiny of Google in jurisdictions beyond the EU, including the United States. In the months ahead, we will make this case directly to the newly confirmed antitrust authorities at the Federal Trade Commission and Department of Justice. In the meantime, we believe it is imperative the European Commission extend its finding of guilt related to Google search bias from comparison shopping into local search and demand broad non-discriminatory remedies across all search verticals.
The European Commission’s ruling of additional illegal conduct by Google on smartphones is another important step in restoring competition, innovation and consumer welfare in the digital economy; the EU must ensure complete compliance from a recalcitrant Google and the US must take action to provide American consumers with similar protections.