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EU to force online platforms to make search ranking algorithms more transparent

european parliament

Google and other companies that operate search engines in Europe will have to be more transparent in how they rank search results. The European Commission on Monday issued guidelines to online platforms with requirements under the European Union’s Platform-to-Business regulation (P2B).

The Commission hopes to force online platforms to make the “right information” available to business so that they can manage their online visibility. Once businesses have this information, they will essentially be able to understand how the ranking algorithm works, and tailor their own digital properties to optimise them around it. Businesses would, hence, be able to have the information they need to improve the presentation of goods and services they sell online and have more visibility.

“[The Guidelines] will also provide valuable support for the adequate and effective enforcement of the transparency requirement to ensure online platforms are acting fairly in their ranking practices,” the Commission said in a statement.

Margrethe Vestager, executive vice president of the Commission, said that the Guidelines will “set the standard for algorithmic ranking transparency and will increase fairness in the online platform economy”. Meanwhile, Thierry Breton, European Commissioner for the Internal Market, said that the principle of transparency would also underpin the forthcoming EU’s Digital Markets Act, “which will prevent illegal behaviour before it even takes place”.

The guidelines comes at a time of worldwide attention on Big Tech firms for monopolistic business practices. Google’s search engine, the market leader across the world, has been accused of opaque in how businesses, especially rivals, are made visible in search results. For instance, in 2017 the European Commission fined Google €2.42 billion for abusing its dominance  by ranking its own service (which allowed users to compare product prices across websites) higher than comparable services.

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  • Startups coalition wanted action against Google: Last month, a large coalition of 135 startup and tech companies wrote to the Commission, urging it to take antitrust action against Google. The coalition had major members from the travel industry such as Booking.com, Kayak, TripAdvisor and Yelp. The companies had argued, reported TechCrunch, that Google was violating the 2017 EU decision by self-preferencing and demoting rivals. They accused Google of pointing users to its own services, at the expense of rivals.

Of late, transparency on how ranking algorithms work has been proposed as a remedy to such behaviour. A similar solution has been proposed by the Australian competition regulator’s News Media Bargaining Code, which hopes to empower news publishers to strike a deal with Google and Facebook. The Code proposes for the two companies to provide publishers information on any changes to their ranking algorithms. Google has come out against this mandate, claiming that it will slow down upgrades and improvements to its Search service, and ultimately problematic for its users.

More Big Tech regulation upcoming in Europe

Meanwhile, the Commission is set to publish the Digital Services Act and Digital Markets Act on December 15. In an op-ed for The Irish Times earlier this week, Vestager and Breton had said that the Digital Services Act will impose new obligations and responsibilities on all online intermediaries with regard to the content their host. This will include a framework to deal with illegal content — hate speech, terrorism, child pornography, sale of counterfeit products and so on. The Digital Markets Act, on the other hand, will aim to keep digital markets “open and contestable”. “The Digital Markets Act will more specifically target the economic behaviour of companies that have become systemically relevant,” they said.

Big Tech under lens globally

Big Tech companies across the world are under intense scrutiny from antitrust regulators. The United States’ Department of Justice (DOJ) has filed a lawsuit against Google, calling it the “monopoly gatekeeper” for the internet. The DoJ accused Google of pushing its core services such as Gmail, Goolge Play, Search, Maps, Chrome and YouTube on manufacturers of Android phones, among other things. It has even suggested the break-up of Google. CEOs of Google, Facebook, Apple and Amazon have been summoned by US House subcommittee on antitrust to testify on antitrust queries.

Last month, the United Kingdom announced that it will set up a new body for the purpose of regulating Big Tech companies. The proposed Digital Markets Unit (DMU), expected to be operational from April 2021, will enforce a new statutory code to ensure “acceptable behaviour” by companies like Google and Facebook.

India has also trained its eyes on Google. The Competition Commission of India (CCI) had opened several investigations into the company, the latest being one about its Play Store and Google Pay. Other probes include one for Google’s abuse of the smartphone OS market, and another in the smart TV market.

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