New competition rules come with trade-offs

There’s an active debate in some countries about whether to adopt new rules that single out a handful of leading technology services. While these prescriptive laws seek to promote competitive digital markets, they can involve trade-offs that raise prices and limit choice for consumers and businesses. We wanted to share some of the concerns we’re hearing following changes we’ve made to comply with Europe’s recently enacted Digital Markets Act (DMA).

Helping businesses and consumers

Under the DMA, we’ve had to remove useful Google Search features for flights, hotels and local businesses. This means that if you search for a flight in Europe, we can no longer show a full array of information about carriers, flight times and prices. This benefits a small number of online travel aggregators, but harms a wider range of airlines, hotel operators and small firms who now find it harder to reach customers directly.

We introduced these types of Google Search features to help consumers, making it easier for people to access accurate information. There’s now more friction when you search for a flight on Google in Europe. And there’s a greater risk that you’ll end up on a travel website advertising a low fare that jumps just before you make a purchase, with a message like “this fare is no longer available.”

Reporting early responses to DMA compliance

Here are a few other things we’re seeing across countries where DMA changes have been introduced:

• We’ve seen increased traffic to a small number of successful intermediary services and significantly less engagement with a wide range of businesses like airlines, hotels, local merchants and restaurants.
• Hotels are concerned that direct booking clicks are down as much as 30% since our compliance changes were implemented. These businesses now have to connect with customers via a handful of intermediaries that typically charge large commissions, while traffic from Google was free. European airlines and local businesses have expressed similar concerns.
• Consumers have expressed negative views about changes to the display of Google Maps in Search. Many European users are raising concerns on message boards and in our help forums that they no longer see a useful Google Maps tab on our Search results page.

Balancing interests and focusing on consumers

We’ve always been focused on improving Google Search to help people quickly and easily find what they’re looking for. We developed Google Images to show a photo instead of just a link to a photo. We launched Google Maps to help you find a local business, not just websites that mention its address. And we developed ways to make it easy for people to directly connect with airlines, hotels, and merchants, saving time and money. These features also help a lot of independent companies, including small businesses, compete with large, successful websites.

Rules that roll back some of these advances represent a fundamental shift in competition policy. We encourage other countries contemplating such rules to consider the potential adverse consequences — including those for the small businesses that don’t have a voice in the regulatory process.

We’ll continue to be transparent about our DMA compliance obligations and the effects of overly rigid product mandates. In our view, the best approach would ensure consumers can continue to choose what services they want to use, rather than requiring us to redesign Search for the benefit of a handful of companies.