Airlines, Hotels, and Retailers Concerned About Exclusion Due to Google’s Search Algorithm Changes

BRUSSELS- Lobbying groups for airlines, hotels, and retailers have called on EU tech regulators to ensure that Google considers their perspectives, not just those of major intermediaries, when implementing changes to comply with significant new tech regulations.

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In March, several groups, including Airlines for Europe—which counts Air France KLM and British Airways owner IAG as members—along with Hotrec, the European Hotel Forum, EuroCommerce, Ecommerce Europe, and Independent Retail Europe, voiced their concerns about the effects of the new regulations.

The EU’s Digital Markets Act (DMA) sets a series of regulations for Google and five other major tech companies to enhance user choice and improve competition. However, various groups have expressed concerns that these changes might negatively impact their revenues. In a joint letter dated May 22 to EU antitrust chief Margrethe Vestager and EU industry chief Thierry Breton, they indicated that their concerns have only increased since their initial expression of worry.

“Our industries have serious concerns that currently considered solutions and requirements for implementing the DMA could further increase discrimination,” they wrote.
“Initial observations indicate that these changes risk severely depleting direct sales revenues of companies by giving more prominence to powerful online intermediaries due to the preferential treatment they would receive,” they said.”

The Commission, which is now investigating Google for possible DMA breaches, did not immediately respond to a request for comment.
Google, which in a March blog post said changes to search results give large intermediaries and aggregators more traffic and less for hotels, airlines, merchants and restaurants, had no immediate comment.
“We are concerned that the non-compliance investigation refers only to the need to treat third-party services in a fair and non-discriminatory manner, without any acknowledgement of European businesses that also offer their services on Google,” the groups said.
Recent developments highlight that the airline, hotel, and retail industries are expressing concerns about Google’s compliance with the European Union’s Digital Markets Act (DMA). The DMA, which aims to foster fair competition and consumer choice, has led Google to make over 20 changes to its products, including alterations to search results and advertising practices. These changes have prompted worries that smaller businesses may lose visibility and revenue as Google’s updates could favor larger intermediaries​ (Hotel Management Network)​​ (Search Engine Land)​.
Industry groups, including Airlines for Europe and Hotrec, have voiced their fears that Google’s adjustments may further increase discrimination against direct suppliers like hotels and airlines, potentially reducing their direct sales​ (Hotel Management Network)​​ (Search Engine Land)​. They argue that the preferential treatment given to powerful online intermediaries could diminish the competitive opportunities for smaller players.
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Google has stated that it has collaborated with the European Commission to balance compliance measures with the needs of various stakeholders. However, the company acknowledges that some of the new rules involve difficult trade-offs that might reduce the effectiveness of certain features designed to help users​ (Search Engine Land)​​ (Engadget)​.

 

Here are the main points from the news article:

– The EU’s Digital Markets Act (DMA) aims to enhance user choice and improve competition among tech companies, but various industry groups (airlines, hotels, retailers) are concerned that the new regulations may negatively impact their revenues.

– These groups have expressed concerns that Google’s implementation of the DMA may favor larger intermediaries, potentially reducing direct sales revenues for smaller businesses like hotels, airlines, and merchants.

– The groups argue that the preferential treatment given to powerful online intermediaries could further increase discrimination against direct suppliers and diminish competitive opportunities for smaller players.

– Google has made over 20 changes to its products to comply with the DMA, including alterations to search results and advertising practices, but the industry groups are worried that these changes may harm their businesses.

– The European Commission is investigating Google for possible DMA breaches, but has not yet commented on the concerns raised by the industry groups.

– Google has stated that it has collaborated with the European Commission to balance compliance measures with the needs of various stakeholders, but acknowledges that some of the new rules involve difficult trade-offs that might reduce the effectiveness of certain features designed to help users.

 

Here are the potential negative impacts of new regulations on industry groups:

Airlines:

– Reduced direct sales revenues due to preferential treatment of online travel agencies (OTAs)
– Increased discrimination against airlines in search results
– Loss of visibility and competitiveness

Hotels:

– Decreased direct bookings and revenues due to favored placement of online travel agencies (OTAs)
– Reduced visibility and competitiveness
– Negative impact on small and independent hotels

Retailers:

– Decreased visibility and sales due to favored placement of larger online marketplaces
– Reduced competitiveness and direct sales revenues
– Negative impact on small and medium-sized enterprises (SMEs)

Common concerns:

– Preferential treatment of powerful online intermediaries
– Increased discrimination against direct suppliers
– Reduced visibility and competitiveness for smaller businesses
– Potential loss of direct sales revenues
– Negative impact on SMEs and independent businesses

Note: These points are based on the concerns raised by industry groups in the context of the EU’s Digital Markets Act (DMA) and Google’s implementation of the regulations.

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