In response to Google LLC, which is the dominant company in the search field, antitrust authorities in Europe and America have continuously strengthened restrictions and sanctions. The European Union has improved its legal system to restrict the use of search services to provide preferential treatment for its own companies; The United States filed a lawsuit against Google; Japan has also started conducting inspections.
Japan’s Fair Access Commission (FTC) began its review of Google on October 23. Google, which has a huge share of the market for search services, also has an advantage in its relationship with customers. Around Google, European and American antitrust departments continue to strengthen restrictions and sanctions. The Japan Fair Access Commission is also taking a strict stance to ensure competition in the Japanese market.
“Multiple overseas authorities have conducted investigations and prosecutions have been filed in countries and regions. Regarding the Japanese market, I believe that the Japan Fair Access Committee needs to review “, the director of the Japanese Fair Access Committee, Tianbianzhi, held a press conference on October 23 to emphasize the significance of the review.
The strength of Google, which was founded in the US in 1998, is its cutting-edge search technology. Since the 2000s, Google’s search service has won the competition with other competitors and continued to expand its share.
As the number of users of Google’s search service has increased, the sales of advertising business, which is linked to search terms, have also increased. Google’s online ad-related sales reached more than $220 billion in fiscal 2022, accounting for about 80 percent of total sales.
Private survey data show that as of 2022, Google’s global share in the mobile search market has reached 96%, showing a dominant state. In Japan, Google s search service accounts for 78 percent of the total, and LINE Yahoo, the second largest in Japan, uses Google s search engine technology with 20 percent.
Some people have long suspected that Google’s search services, which have an absolute advantage, violate the Exclusive Prohibition Law (Anti Monopoly Law). Regarding the violation of allowing terminal manufacturers to pre install their own search services, the Japanese government’s Digital Market Competition Conference in April 2021 pointed out that “the possibility of maintaining and strengthening a competitive advantage cannot be ruled out”. It is proposed that the Japanese Fair Access Commission should determine whether to conduct a case review.
Regarding the launch of the review of Google, Nakajima cauliflower, senior inspector of digital platform operators at the Fair Access Commission, said: “This does not mean that gaining a high market share through competition is regarded as a problem. But if there is a mechanism that prevents competitors from competing on an equal footing, it will hinder innovation in the long run and may cost consumers.”
With the development of generative AI, the competition of search services has entered a new situation. Japan’s Fair Access Committee has been preparing for an effective review of large IT companies. In order to gather information, the company announced a new policy in June 2022 to identify cases from the early stage of review, and hired more lawyers with practical experience from outside.
Regulatory trends in Europe and the United States have also played a role in promoting Japan’s Fair Access Committee. The European Union is moving to improve its legal regime to restrict the use of search services to favour its own companies; The move in the US is to file a lawsuit against Google.
Under the circumstances of strengthening supervision in various countries, the Japanese Fair Access Commission has been exchanging information with the antitrust departments of European and American countries. The direction of censorship in Japan also has the potential to influence the course of litigation in the United States, where countries have spread the net of regulation around the world by acting in concert.
On November 8th the antitrust authorities of the Group of Seven (G7) leading economies will hold a high-level meeting in Tokyo. At the first meeting in 2019, they confirmed their intention to strengthen cooperation on issues such as market control and obstruction of competition by very large companies. The decision to censor Google, the representative of large technology companies, is also seen as a sign that Japan, as the rotating country, is strengthening supervision of large IT companies.
Source: Nihon Keizai Shimbun