The European Union has launched an antitrust investigation into Alphabet (GOOGL.US), expressing concerns that the tech giant may be leveraging its proprietary artificial intelligence (AI) tools to suppress competitors and abuse its market dominance.
In a Tuesday statement, the European Commission announced it would examine whether Alphabet imposed unfair terms on content creators or granted its AI models exclusive advantages over rivals, potentially distorting market competition. Additionally, EU regulators will scrutinize the extent to which Alphabet's AI Overview and content generation models source material from online publishers and whether fair compensation was provided.
EU antitrust chief Teresa Ribera emphasized during a Brussels speech: "This investigation sends a clear signal of our commitment to protecting online media and content creators while ensuring fair competition in the emerging AI market."
This probe follows closely after the EU imposed a €3 billion (approximately $3.5 billion) fine on Alphabet in September for favoring its own advertising technology services over competitors. The penalty drew sharp criticism from former U.S. President Donald Trump, who called it "discriminatory." The Trump administration had previously expressed concerns about the EU's series of hefty fines against major tech firms, including cumulative penalties exceeding €9.5 billion against Alphabet and a separate €13 billion tax ruling against Apple (AAPL.US).
Alphabet has faced multiple EU antitrust actions, accumulating billions in fines, including €4.13 billion for Android-related monopolistic practices and €2.42 billion for suppressing shopping search competitors. While a €1.49 billion AdSense service fine from 2024 was overturned last year, the company now faces additional scrutiny under the EU's Digital Markets Act, which took effect in 2023 to regulate global tech platforms.
Under traditional EU antitrust rules, regulators can order companies to halt questionable practices, though firms may appeal to the Luxembourg court. Violations can theoretically result in fines up to 10% of global annual revenue, though maximum penalties are rarely imposed, especially for short-term infractions.
Alphabet must now submit compliance proposals to address regulatory concerns. As of press time, the company has not responded to requests for comment.
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