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> Whether it's 100m or 2bn doesn't really matter. ...yet, it will absolutely matter if it's $20B - Google's 2020 operating income was $41B. You're making the

by fouric 5y ago

> Whether it's 100m or 2bn doesn't really matter. ...yet, it will absolutely matter if it's $20B - Google's 2020 operating income was $41B. You're making the claim that since Google wasn't fined enough, fines don't work - which is absurd. Try making the fines a reasonably large percentage of gross revenue from the previous year - say, 10%. 10% of Google's 2020 gross revenue ($182B) is $18B, which is almost half of their operating income. That will have an effect.

qubex 5y ago
The problem with this is that you can easily bankrupt a company by codifying exceedingly onerous terms. Google (to take your example) happens to be able to (barely) afford 10% of their revenue taken from their income. Another company with a different cost structure (perhaps in another sector) might not be able to afford that. The upshot is that providing a codified “one size fits all” punishment could be disastrous (if you consider preserving companies to be desirable: for the sake of this argument I do, but entirely legitimately you might not). In the case of Italy (I’m Italian) and it’s awkward, glacial justice system, that’s a very dangerous assumption to make. This place is already hostile enough towards businesses.
dalbasal 5y ago
...maybe in theory. Fines are, largely calibrated one way or another. It's not marked to gross revenue... but it is usually marked to the infraction. In the EU-Adwords case, the $2bn fine was relative to the size of adwords search partners' EU market share. In this Italian case (I assume) the fine is scaled to the size of the monopolised sector... Italian apps or whatnot. This is why I called it a "violation-fine paradigm." Courts can't arbitrarily fine companies "enough to make it hurt." It has to relate to laws, specific infractions. Laws have to be general. Etc. My point is that the infraction itself is not the problem. It's a sign of the problem, a symptom... the problem is monopoly. There's no version of adwords partner agreement (including the post-fine version) that isn't still a problem, even if it doesn't contain abuse of power clauses. The problem is that the only meaningful market for search ads is Google's. Similar issue for Amazon marketplace. There's no version of Amazon marketplace policies where amazon retail competes on a level playing field... they own the field. You fine a company for doing something wrong. Google do things wrong, from time to time... but the main problem is what Google is, not what they do. That's derivative.

by fouric 5y ago

qubex 5y ago

The problem with this is that you can easily bankrupt a company by codifying exceedingly onerous terms. Google (to take your example) happens to be able to (barely) afford 10% of their revenue taken from their income. Another company with a different cost structure (perhaps in another sector) might not be able to afford that. The upshot is that providing a codified “one size fits all” punishment could be disastrous (if you consider preserving companies to be desirable: for the sake of this argument I do, but entirely legitimately you might not). In the case of Italy (I’m Italian) and it’s awkward, glacial justice system, that’s a very dangerous assumption to make. This place is already hostile enough towards businesses.

dalbasal 5y ago

...maybe in theory. Fines are, largely calibrated one way or another. It's not marked to gross revenue... but it is usually marked to the infraction. In the EU-Adwords case, the $2bn fine was relative to the size of adwords search partners' EU market share. In this Italian case (I assume) the fine is scaled to the size of the monopolised sector... Italian apps or whatnot. This is why I called it a "violation-fine paradigm." Courts can't arbitrarily fine companies "enough to make it hurt." It has to relate to laws, specific infractions. Laws have to be general. Etc. My point is that the infraction itself is not the problem. It's a sign of the problem, a symptom... the problem is monopoly. There's no version of adwords partner agreement (including the post-fine version) that isn't still a problem, even if it doesn't contain abuse of power clauses. The problem is that the only meaningful market for search ads is Google's. Similar issue for Amazon marketplace. There's no version of Amazon marketplace policies where amazon retail competes on a level playing field... they own the field. You fine a company for doing something wrong. Google do things wrong, from time to time... but the main problem is what Google is, not what they do. That's derivative.