Ask Jerry: What happens if Google ignores the EU's DMA rules?

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If Google ignores the DMA rulings, what happens?

Alex asks:

I saw the news about Google not complying with the EU regulations and I was wondering what would happen if Google just ignored it?

Can Google be banned in Europe?

Thanks

Howdy Alex and thanks for such a great question!

Usually, I spend my thinking time wondering how Google will find ways to comply with laws and regulations and still keep an advantage, and never thought about Google just saying no.

I've no doubt that's what it really wants to do: just laugh and keep on truckin' without a care. That's a way to make lots and lots of money, after all. But I don't think Google will. I also think the EU wouldn't go as far as kicking Google out of the continent (so to speak).

Normally, laws and regulations are set up as a compromise. A good example is how countries want factories to make goods but don't want them to just churn out pollution. A common ground must be found that benefits both sides and, in a best-case scenario, also benefits the citizenship. What we are seeing right now in the U.S. and elsewhere isn't quite normal, so it's easy to forget how it's supposed to work.

I think the EU's DMA (Digital Markets Act) is a really good idea. It's not perfect, but no set of regulations will ever be perfect. I also agree with the rulings that Google is violating and want to see the company forced to do the right thing, even if it costs them a little bit of money in the end.

I say I think they will find a solution, but let's explore what happens if they don't.

Two worst-case scenarios

If Google were to just ignore the DMA rulings two very bad things could happen.

The first is that the company is banned from doing business in the EU. While Google may be unfairly using its status to exert more control over things like payments and ads, a lot of people and companies are making money through the company. If Google were to be "banned," that means more than not being able to sell Android phones or TV Streamers; it means not being able to sell ad space or services like Google Workspace, and plenty of companies depend on those services.

Taking Google out of the picture would mean a mad scramble for companies to find replacements that might cost a lot more and could drive many of them out of business. EU regulators and Google both know this, and that's why I don't think this would ever happen — it would have a terrible effect on the very people the EU is claiming to protect and Google claims to want to serve.

Another possibility is even worse: Google says no, and the EU does nothing about it.

If Google were to just keep on doing business the way it always has, even though the DMA has ruled it can't, and nothing happens, it would open a floodgate. Other companies would see this and know that they might be able to ignore the law, and Google would 100% go further.

Imagine a trifecta of corporate greed consisting of Google, Meta, and Amazon, knowing they can do whatever they like without any repercussions. Executives would have visions of swimming in a pool filled with gold like Scrooge McDuck.

The reasons the DMA was enacted would then mean nothing, and companies would try to use any practices, fair or otherwise, to gain an advantage. Then they would use it.

What will probably happen

The EU is going to continue to make demands, and Google is going to continue to fight them. This is normal behavior between two sides with different goals. It's a shame so much money will be spent to try to find common ground, but it is what it is.

Fines will be levied, which Google will appeal and protest. In the end, the rulings will be "bent" slightly, so Google wins a little bit, and the company will pay some money for being so stubborn about it. We're talking traffic ticket level of justice here, not something like execs facing jail time or anything. There will be no re-enactment of Bastille Day or guillotines involved.

This will also send the right message to others: we (the EU) will find a way to enforce our laws and reign you in; we're not afraid to fight it out. Then Google will find another way to skirt the rules until it gets caught. There is too much money to be made for it to go any other way.