Re:European Commission fines Google €2.42B for abusing domin...
by briandear on Tuesday June 27, 2017 @07:26AM
(#14644327)
The problem too is that the competing services aren’t even that good. For example, if I search for a specific type of Miele oven from here in France, I can type the model number and Google gives me an array of choices from various stores it was awesome. If Google didn’t do that, then what results should it return? A bunch of other shopping sites on which I would do the exact same thing but not have the same quality of results? French comparison services just outright suck. The interfaces are barely a step up from Minitel.
I am definitely not a Google fanboy; I don’t like Android and I’m not big into their cloud apps, but when it comes to search, they are the best. EU companies could try and compete but they haven’t. Has any EU company tried to build a high quality search experience? If they aren’t succeeding then why?
The problem in France, as I see it is government. As an example, DailyMotion rivaled YouTube for a short time, as soon as DailyMotion was about to be acquired for a huge sum by Yahoo, the French government blocked the sale because Yahoo wasn’t French. That immediately sent a signal that if you put a lot of VC/investment into a French company, your exits were subject to the whims of a protectionist government bureaucracy, which makes investing in French companies relatively more risky than investing in American companies in terms of ROI.
Did the DailyMotion deal contribute to the current Google dominance? I think it definitely had a chilling effect on high growth unicorn chasing in the EU which means the “French Google” hasn’t been born because it is much much harder to access funding than a similarly positioned company in the US. I am not saying the French startup scene is dead or bad, but the ultra-high level moonshots that are fairly common in the US are extremely rare in France because of the bureaucratic environment. Blah Blah Car raises $200 million against a $1.6b valuation, but that is pretty much an outlier and likely the result of an investor play against Uber’s French difficulties.
My point: if the EU wants to prevent monopoly situations, member states ought to be doing more to get out of the way of innovation. They can do that by lowering taxes. Even if you have a winning investment in France, an investor gets butchered in capital gains taxes thus requiring a 10x investment to actually be a 25x investment to be worth it. With such a low hit rate for VCs in general what incentive do they have to kneecap themselves by investing in places like France?
I am definitely not a Google fanboy; I don’t like Android and I’m not big into their cloud apps, but when it comes to search, they are the best. EU companies could try and compete but they haven’t. Has any EU company tried to build a high quality search experience? If they aren’t succeeding then why?
The problem in France, as I see it is government. As an example, DailyMotion rivaled YouTube for a short time, as soon as DailyMotion was about to be acquired for a huge sum by Yahoo, the French government blocked the sale because Yahoo wasn’t French. That immediately sent a signal that if you put a lot of VC/investment into a French company, your exits were subject to the whims of a protectionist government bureaucracy, which makes investing in French companies relatively more risky than investing in American companies in terms of ROI.
Did the DailyMotion deal contribute to the current Google dominance? I think it definitely had a chilling effect on high growth unicorn chasing in the EU which means the “French Google” hasn’t been born because it is much much harder to access funding than a similarly positioned company in the US. I am not saying the French startup scene is dead or bad, but the ultra-high level moonshots that are fairly common in the US are extremely rare in France because of the bureaucratic environment. Blah Blah Car raises $200 million against a $1.6b valuation, but that is pretty much an outlier and likely the result of an investor play against Uber’s French difficulties.
My point: if the EU wants to prevent monopoly situations, member states ought to be doing more to get out of the way of innovation. They can do that by lowering taxes. Even if you have a winning investment in France, an investor gets butchered in capital gains taxes thus requiring a 10x investment to actually be a 25x investment to be worth it. With such a low hit rate for VCs in general what incentive do they have to kneecap themselves by investing in places like France?