Google is making a recent effort to change upcoming EU laws on Big Tech with a flurry of ads, emails and social media posts targeting politicians and officials in Brussels.
As policymakers in the European Union finalize the Digital Markets Act (DMA), executives at Google’s headquarters in Silicon Valley are stepping up efforts to loosen parts of legislation they fear will have a serious impact on their business.
“California’s top executives have known about DMA all along, but only now have they woken up,” said a Google insider.
The campaign involves direct lobbying by Google, but also by several trade associations funded by the search giant.
Kim van Spartak, a Dutch parliamentarian, said she had noticed a marked escalation of pressure in recent weeks, with the message that curbing Google would hurt small businesses.
She said she was invited to discuss her views with Google, at a time of her choosing, and was invited to an event organized by the company on the benefits of digital marketing for small businesses.
I was also pressured by the Connected Trade Council, whose partners include Google and Amazon, with a letter signed by small business owners saying: “Please don’t make it more difficult for my business.”
Other members of the European Parliament and officials said their Twitter feeds have recently been filled with ads from tech lobby groups about issues that Google is particularly interested in. “My firing is growing fast,” said an EU diplomat.
One of the campaigns against the proposed ban on targeted advertising, which appeared on Twitter and in the trade press, was led by IAB Europe.
Alderik Oosthoek, a policy adviser to the European Parliament, wrote on Twitter: “I am being targeted with an almost unrecognizable ad targeting EU officials promoting misinformation and referring only to IAB studies.”
The DMA, which has made smooth progress so far through the EU Parliament and is likely to come into effect at the beginning of 2023, aims to reduce the power of big tech “gatekeepers” – companies like Google whose platforms dominate the online economy. Last week, Germany’s competition watchdog formally defined Google as a “gatekeeper”, opening the door to tougher local oversight.
Google is concerned that the legislation will prevent it from promoting businesses it owns, such as travel and hospitality comparison services, on search results pages, a practice known as “self-preferring.”
This could force Google to “fundamentally change the design of public search pages,” said Thomas Huebner of Hausfeld law firm.
Google’s sense of urgency was compounded by a major legal defeat late last year when the Luxembourg General Court upheld a €2.42 billion antitrust fine against the company for promoting its comparison shopping service over rivals in search results.
In the weeks following the ruling, Sundar Pichai, CEO of Alphabet, Google’s parent company, discussed the issue and upcoming tech regulations with Margrethe Vestager, the European Union’s head of digital competition, in a virtual meeting.
Separately, Kent Walker, Alphabet’s head of global affairs, held similar meetings with other high-profile regulators, including Vera Jourova, vice president of the European Union.
Thomas Fengy, legal counsel at FairSearch, said the court ruling and the DMA were a threat to Google because “its very business model relies on competitors to harm competitors and differentiates its own services in its search results.”
While it made some adjustments after the initial 2017 fine, Google has yet to implement any other changes to its search pages in light of Luxembourg’s ruling, against which it is expected to appeal.
Separately, Google is concerned about a proposed EU ban on targeted advertising by a single bloc of MEPs, although the current common position falls short of a complete ban.
“The attitude of MEPs on targeted advertising is insane,” said a person close to Google, adding that such a ban would lead to more popups asking for approval.
According to the European Union Transparency Register, Google invested about 6 million euros in lobbying activities in 2020 and has approximately eight internal lobbyists in Brussels, as well as retaining external lawyers and consultants. Last year, it had to apologize to Thierry Breton, the European Union commissioner also responsible for digital regulation, after it emerged that Google was hatching a “pushback” scheme against him.
Intense stress may not have its intended effect. “They’re the bad guys right now,” said a parliamentary assistant involved in the DMA discussions. “Everything coming from them is a bit embarrassing and it’s hard to justify why it’s included in the legislation.”
Andreas Schwab, the MEP who is leading the DMA debate in Parliament and a longtime prominent Google critic, said the company’s efforts are “a little late” to have a significant impact.
“I have a feeling they’re worried,” said Schwab, who met Google’s Walker a few weeks ago. “And they should be.”
Google said: “We believe that people in Europe should be able to enjoy the best services that Google can offer. It is clear that some of the proposals in the DMA and DSA [Digital Services Act] It affects us directly and will have an impact on how our products are created in Europe. We care about getting the balance right, and we know our users and customers care, too. Like many others, we have engaged openly and constructively with policy makers throughout the legislative process to make our point clear.” – Copyright The Financial Times Limited 2022