Bloomberg reported on Tuesday that Google (NASDAQ:$GOOGL) will create a standalone unit for its shopping service and the unit will bid against rivals for ads displayed on the top of its search page. Why? Because the European Union ordered the Mountain View, California-based company to offer equal treatment to shopping competitors.
Google is approaching a Thursday deadline to acquiesce with an EU antitrust order for it to give equal treatment in how the search engine displays rival shopping sites, according to people close to the matter.
The shopping service will continue to be apart of Google, but it will operate independently. It will also use its own revenues to bid for ads. Further, there will be ten ad panel slots up for auction with Google Shopping operating as a solo unit in an attempt to make it clear that the costs aren’t subsidized by Alphabet Inc., the parent company.
Regulators ordered the company to stop promoting its own shopping search results over rivals and to make changes by September 28 so competitors have a better chance of moving up in the running, the EU said in June.
The EU fined Google $2.8 billion in June, and now the company faces fines up to 5% of daily revenue if it fails to comply.
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