As we know this week Google was slapped with a record-breaking €2.4bn fine by European regulators for abusing its dominant position in the world of online shopping.
According to the European Commission the search engine has 90 days to end the misconduct. If it does not, it faces penalty payments of up to 5 per cent of the average daily worldwide turnover of Alphabet, which is Google’s parent company.
This is not the first time a major market player has been fined for abusing it’s position. So have there been any lessons learnt?
With dominance comes responsibility:
The position should certainly not be used to cause unfair and undue harm to the very customers that have trusted them time after time. After all, the company enjoys it’s dominance because of it’s very own customers.
Under watch at all times:
It is but obvious that once a company becomes a dominant player in their market they would always be susceptible to close scrutiny. Everything they do or say or even imply will be under close scrutiny at all times. Not only the board of directors but also every staff becomes a mascot for the company. So while they enjoy the dominance they need to be aware that they are being watched at all times.
Play big but play fair:
Competition needs to be healthy and when one company begins to occupy a large portion of the market share they need to ensure they encourage competition in a way that allows the market place to be a fair playing field. Why??
Well, for the benefit of it’s customers who enabled them to be a dominant player in the first place. It’s when customers get a fair choice, they get a fair return for their prices which means they keep coming back for more which translates into growth and more investments. The customer wins and isn’t this the ultimate aim anyway?
So when Google found itself in a top spot they had a responsibility to ensure the customer still got a good range of choice and price. Instead they were focused on maintaining their own strong position at the expense of the customer, and were duly punished.
Being successful and a dominant player should not be punishable. But when their position tempts them to take advantage of the very customers that got them to the top then that can turn very dangerous.
Good luck!
SD
PS: Click here for more information on this particular fine by the EU commission.
