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Google shakes up European operations amid regulatory scrutiny

A Google exec says the realignment will help Google respond more quickly to what's happening in individual countries.

Google's European division has come under a single roof, but who knows if that will help the company with regulators.

Search giant Google has combined its two units operating in Europe, as competition watchdogs continue to apply pressure on the company.

Google's Northern and Central Europe unit will combine with the division covering Southern and Eastern Europe, the Middle East, and Africa, the company announced in Brussels on Thursday, according to the Financial Times. The announcement was made by Matt Brittin, who will head up the newly formed division as president of EMEA Business & Operations.

Google did not immediately respond to a request for comment.

The realignment comes as Google faces increasing scrutiny from Europe's competition commissioner, Margrethe Vestager, who is investigating whether Google search is hampering competition across Europe. If Google is found guilty of engaging in anticompetitive practices, it could face billions of dollars in fines.

Google has for years been trying to satisfy EU regulators, who have taken aim at the company's popular search service. Those regulators have specifically taken issue with the way Google displays content within its search, arguing since 2010 that it may be providing preferential treatment to its own services, like Gmail and Google Maps.

Last year, Google proposed a tentative settlement -- its third -- that would have forced the company to display search results for all services, including its own, in the same way. The company wouldn't have been required to pay a fine.

In September, however, European regulators, who had preliminarily agreed to the idea, said that they had received "fresh evidence" and "solid arguments" from 20 formal complaints. Those complaints, which came from competitors like Microsoft, prompted the regulators to send Google back to the drawing board.

"We now need to see if Google can address these issues and allay our concerns," former EU competition commissioner Joaquin Almunia said at the time. If Google's response doesn't satisfy the commission, the "logical next step is to prepare a Statement of Objections," Almunia said, referring to formal charges.

Just two months later, the European Parliament approved a resolution suggesting regulators "consider proposals" that would force companies to break search services apart from "commercial services." While the vote was little more than a suggestion, did not mention Google by name, and did not actually call for any breakup, it was clear that the search giant was in the organization's crosshairs.

Google owns more than a 95 percent share of the markets for online search and the profitable search ads that come with them, according to some estimates. Regulators worry that Google will continue to use the massive amount of cash generated from those ads to fuel expansion into other industries. By breaking out search, regulators could blunt the impact Google could have on competition, some argue.

The company has several rivals that take issue with Google's ability to promote its services, including travel booking sites such as TripAdvisor, Expedia and Hotwire, and shopping sites TheFind and Foundem. All of those companies are members of FairSearch, a consortium of companies, mainly from the US, that have lobbied EU officials for greater regulation on Google and the ways it integrates its own services into search.

Google has argued that search engines are no longer just a list of links to other sites and the company should be allowed to provide relevant information without forcing a user to leave its pages. Google now has weather reports, medical information, and calculators, among other tools, baked into its search pages.

"Larry Page, our co-founder, has always believed that the perfect search engine would 'understand exactly what you mean and give you back exactly what you want,'" Google senior vice president of global communications Rachel Whetstone said last year. "Initially, 10 blue links were the best answer we could give. But now we have the ability to provide direct answers to users' queries, which is much quicker and easier for them."

So far, Google's arguments have proven incapable to allay regulator fears. Indeed, there is a possibility that the current investigation into the company's search could only get worse and extend to another dominant Google platform: Android.

It's unclear whether the realignment in Google's European operations will have a positive impact on the company's ongoing negotiations with regulators. At this speech in Brussels, Brittin said that the move would help Google respond more quickly to what's happening on a country level, according to the Financial Times. He did not mention his company's antitrust investigation.

Still, Google is at least trying to play nice in Europe. Also on Thursday, Brittin published a post to Google's Policy Europe blog highlighting how the company has become "a growth engine for European businesses." The blog post, a thinly veiled attempt to win favor in a time when it has very few people on its side, argues that Google has helped a wide range of businesses and paid out over 4.4 billion euros (about $5 billion) to European developers in 2014.

To sweeten the pot, Brittin said that Google will train 1 million Europeans by 2016 "in crucial digital skills." The company will also invest 25 million euros to expand its current business-focused programs to other parts of Europe.

"Some people look at the state of the economy in Europe and are pessimistic," Brittin said of the continent he now controls. "We see something else: a huge diversity of businesses and entrepreneurs with creativity, ambition, and talent -- all using digital tools to create jobs and boost the economy."

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