Just one week before Christmas, the Competition and Markets Authority of the United Kingdom made an announcement that may have played a part on shares of Alphabet, the parent company of Google, losing nearly 3% on the Nasdaq. Usually, announcements related to information security issues tend to have an immediate effect on company stock, but such is not the case with the British CMA; the problem is related to Google’s acquisition of Looker Data Sciences, a data visualization platform headquartered in California.
According to a news report by the Associated Press, the CMA became interested in the aforementioned acquisition in early December with an enforcement notice. The concern was that the merger would make consumers think of Google UK and Looker as indistinct business entities; in other words, there are valid concerns that integrating Looker would unfairly make Google the most attractive choice for business owners and individuals looking for cloud computing services, particularly with regard to website and application hosting.
Let’s say an e-commerce fashion entrepreneur in London is looking for a platform where she can set up her online boutique. She wants bandwidth, security, a shopping cart, a digital payment solution, and visual reports of website traffic as well as transactions. After acquiring Looker, Google will probably be the most attractive cloud hosting option for this e-commerce entrepreneur because she thinks Google is providing everything all the way down to data visualization. In this example, it is easy to see the CMA concern because third-party data visualization companies would not stand a chance to compete against Google.
The CMA will have from now until February 2020 to update the public on this matter. Google began taking over Looker in June 2019 and has thus far obtained regulatory approval in the United States and Austria. It should be noted that the UK is still part of the European Union, so other nations could very well start looking at this acquisition deal for signs of anti-competitiveness. In the U.S., Google is one of various technology giants being investigated for what state and federal regulators may consider antitrust activity; interestingly, one of the aspects of these investigations focuses on digital payments, particularly popular platforms such as Apple Pay and Google Pay.