Travel, Retail Firms Say EU Rules Slash Their Google Traffic

Groups representing airlines, hotels and retailers in the European Union have said they are at risk of being frozen out of negotiations between Google and EU regulators as the bloc implements new Digital Markets Act (DMA) competition rules.

Airlines for Europe, which represents Air France KLM and British Airways owner IAG amongst others, as well as hotel groups Hotrec, the European Hotel Forum and retail bodies EuroCommerce, Ecommerce Europe and Independent Retail Europe said Google’s efforts so far to comply with the DMA have been detrimental to their businesses.

They said the situation risks becoming worse with a European Commission investigation into Google’s potential DMA non-compliance.

The investigation is taking into account only the need to ensure competition between Google’s own travel, hotel and e-commerce services and those of other large intermediaries, they said.

DMA compliance

Meanwhile, hotels, airlines and retail services have seen a drop in direct traffic from Google and are being forced to acquire traffic through intermediaries, which charge substantial service fees, Google said in an April blog post.

The DMA singles out large “gatekeeper” tech firms and platforms and aims to ensure competition by barring them from preferring their own offerings over those of rivals.

Google complied in March through actions such as dropping its own flight and hotel aggregation units in EU search results, and instead bringing in a unit that compares results from third-party aggregators.

At the time the hotel, airline and retail groups said the measures risked “situations where the economic power of large online intermediaries is further entrenched”.

The groups said the latest considered solutions and requirements for implementing the DMA “could further increase discrimination”.

Depleted traffic

“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,” the groups wrote in a joint letter to EU antitrust commissioner Margrethe Vestager and EU industry commissioner Thierry Breton.

“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,” they wrote.