As had been previously reported, the European Parliament has now taken a vote on and passed a non-binding resolution that, if it should become a regulatory act of the European Commission, would seek to have Google's Search product broken up into a separate company. The motivation behind the resolution, according to the European Parliament's statement, is in "ensuring competitive conditions within the digital single market."
What's a digital single market? It is essentially the EU's attempt to regulate how businesses and governments alike should behave on the web, particularly in regards to competition, net neutrality, and privacy. The notion is that, if EU governments agree to regulate the internet in a completely uniform fashion as defined by the EU Commission, fewer economic, regulatory, and competitive roadblocks will exist for startups to flourish, no matter what EU state they're from. Well-defined rules about privacy and data will keep consumer information safe and reduce suspicions that a service may not be using your data in a totally 'above-board' way. Competition regulation will then foster lower prices for digital goods and services for consumers by "leveling" the playing field, increasing spending, and will grow the GDP of European economies who encourage digital business. At least in theory.
If this sounds incredibly wishy-washy, that's because it is. But the EU Parliament has decided that if the initiative is to be fully enacted, by its interpretation, search operators will have to change the way they do business quite dramatically. The body has strongly suggested that a "long run" goal of the EU Commission should be to break up (or as they put it politely, "unbundle") search companies that promote their own non-search services through their search engine.
Google is not named in the proposal, but it is clearly the target - Google is the only search engine outside China with a large enough user base to really matter enough from an antitrust perspective at this point (and the only one to really matter at all in the EU). Of course, the EP's authority is non-binding here, so what they say they want is very unlikely to translate into an actual happening - Google would never acquiesce to such a demand.
To many, this seems like just another example of a long-fomenting distrust of large American tech firms among European regulators and politicians. Microsoft, IBM, and Apple are among many such companies singled out by the EC over the years, with such investigations regularly ending in settlements after political saber-rattling by both sides, eventually resulting in compromise. Google itself settled a search-related antitrust investigation with the EC just earlier this year. Many assumed that would be the end of the issue, at least for a while.
But the EP has seen fit to bring the "search issue" back to the forefront of debate, and it is now once again a hot-button political issue in Europe. What exactly would breaking up Google accomplish, according to the European Parliament? Frankly, it's not very clear.
The alleged goal of "unbundling" search products from "other commercial services" is to reduce the risk that consumers choose a search provider's bundled service - such as email, mapping, shopping, texting, or mobile operating system - simply because that search engine happens to be the best and uses that position to promote its own services. While it is never specifically stipulated, essentially, the logic is that the primary reason Gmail, Google Maps, Android, and other services are so popular is because Google's search product has unfairly pushed consumers toward those services and products without giving competitors their fair shake.
In the European Parliament's ideal world, Outlook.com, Yahoo Mail, and Gmail (and probably some other crappy fourth option) would appear with exactly the same prominence in search results no matter which search provider you chose to use. The order of results would not reflect a relationship of the provider to the service, and providers would have to make clear to regulators just how these results are determined, in order to ensure that they are "fair" to the provider's competitors. In other words, search companies would need to entrust the search "secret sauce" to regulators for evaluation.
In addition, there is a far less clearly-defined vision of search providers not being able to generally "abuse" self-marketing of their interlinked services in the first place. The problem with this, as has long been pointed out, is just where self-marketing begins and genuine functionality starts. Is Google abusing self-marketing by putting a toolbar with "You / Gmail / Images" in the top-right corner of the search page? By making itself the default search provider in Chrome? Don't these things unfairly "encourage" users to utilize Google's products, before they even get to the searching part of the equation? Is it unfair that Google News results for "cows" show up in my Google searches, while other feed-based news systems don't? What about Android, is the fact that I have a Google search widget on my homescreen some self-marketing abuse that must be redressed with a choice of what provider the widget uses, even if those providers don't support the same functionality?
Regardless, the chance we'll see Google dismantled into its constituent search and non-search parts is extremely low: this is more political rabble-rousing by a body without any actual legislative initiative powers (EU's parliament cannot write laws, only approve, disapprove, or in some cases, amend them). The European Commission is by no means obliged to draft non-binding resolutions like this one into real legislation, and while the EP does have substantial powers in terms of ratifying and amending law in the EU, even if such a thing were to be passed into law, it's exceedingly unlikely Google would split up its company in compliance.
More than likely, this whole thing will blow over after the EC decides not to act on it, or there will continue to be the same sort of lengthy compromise negotiations Google and the EU have been working at for years.