Breaking up Google

The European Parliament is about to vote on  a resolution that requires, the unbundling of search engines.
Why do I think this idea will not “fly”?

Firstly, there should be a similar separation of powers between the European Commission and the European Parliament as the member states have between their government and parliament – the parliaments act as regulatory bodies, whereas the governments form the executive branch. If we want to tackle this particular case with a resolution passed by the European Parliament then actually, the European Parliament is getting involved in a matter that falls within the jurisdiction of the Commission.

There are proceedings going on between Google and the Commission to address competition concerns on the market of internet search engines, including commitments that should improve the competitive situation. Therefore, by approving a resolution, the European Parliament would interfere directly in the dispute under discussion.

Secondly, if a company has a dominant position on a certain European market then the existing European rules already provide for ways to deal with this matter. In any case, this would be the task of DG Competition to define the market and market shares and the Commission to render a decision based on the analysis, not the European Parliament.

Thirdly, generally the unbundling might be initiated if an undertaking possesses an infrastructure that another undertaking would need for provision of services and this infrastructure cannot be duplicated (or is extremely difficult to be duplicated). Such examples include railways, telecommunication, electric or gas networks. Could an Internet search engine be viewed as a network that is vital for others? Answering this question would require thorough analysis but at first glance it seems rather doubtful.

And finally, picking a fight at such a high level with Google would damage the reputation of the European Parliament. Instead, the parliament could deal with creating the right conditions for the European digital companies to emerge and become global leaders. For that purpose, less regulation would be the answer and not vice versa. When the issue of Google is addressed in such a manner or there are calls for creating “European Google”, this means dealing with yesterday’s news, as things develop much faster. Instead, the fears that hinder the development of the European digital market should be reduced.  I refer to Acemoglu’s and Robinson’s book “Why nations fail?” when I say that people should try to let go of yesterday’s concerns and allow creative destruction to take place in order for the innovation to flourish.