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EU competition chief holds threat of breaking up Google

telegraph.co.uk

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Re: EU competition chief holds threat of breaking up Google

#51

Post by matthewmacleod »

kuschku wrote: post #46
matthewmacleod wrote: post #12

Earlier quoted context omitted.

Which regulations have "resulted in low investment and slow innovation"?

Not regulations, incompatible regulations. If you create a startup in SV, you can easily sell to the whole US. In the EU, you’ll need to obey 28 different laws, 28 different standards, and file 28 different tax forms. This is currently the single biggest hurdle for startups in the EU. The second, of course, is that people seem less willing to throw billions at risky concepts just so one maybe gets big enough.

Well, that’s not regulation. In general, to sell across the EU, you have to comply with the regulations of the single market. That’s largely harmonised; there’s some friction, but it’s not anything like dealing with 28 totally independent countries. It’s surprisingly easy to sell so the whole EU market.

Different social attitudes to risk, and a language barrier, are no doubt much more pressing concerns.

Re: EU competition chief holds threat of breaking up Google

#52

Post by [deleted] »

cf498 wrote: post #34
kuschku wrote: post #17

Earlier quoted context omitted.

There’s a simple trick known as asking the banks where Google keeps their money to freeze those assets.

And that place is called the US. This didnt even work when it was simply a question of having transnational companies on the level of facebook having to pay taxes.

[deleted]

Re: EU competition chief holds threat of breaking up Google

#53

Post by kuschku »

matthewmacleod wrote: post #51
kuschku wrote: post #46

Earlier quoted context omitted.

Not regulations, incompatible regulations. If you create a startup in SV, you can easily sell to the whole US. In the EU, you’ll need to obey 28 different laws, 28 different standards, and file 28 different tax forms. This is currently the single biggest hurdle for startups in the EU. The second, of course, is that people seem less willing to throw billions at risky concepts just so one maybe gets big enough.

Well, that’s not regulation. In general, to sell across the EU, you have to comply with the regulations of the single market. That’s largely harmonised; there’s some friction, but it’s not anything like dealing with 28 totally independent countries. It’s surprisingly easy to sell so the whole EU market. Different social attitudes to risk, and a language barrier, are no doubt much more pressing concerns.

If the field you’re selling in is already harmonised, if you only have employees in one country, and if you have someone else do the VAT for you.

All these can be potential roadblocks that make it harder.

Re: EU competition chief holds threat of breaking up Google

#54

Post by ocdtrekkie »

cf498 wrote: post #34
kuschku wrote: post #17

Earlier quoted context omitted.

There’s a simple trick known as asking the banks where Google keeps their money to freeze those assets.

And that place is called the US. This didnt even work when it was simply a question of having transnational companies on the level of facebook having to pay taxes.

Actually, AFAIK Google still stashes most of it's European profits with a Caribbean island to avoid the taxes of bringing it back to the US. I know Apple's announced a plan to bring their money back in, but I don't know if Google has yet. With the current tax deal in place, they have little reason not to.

Re: EU competition chief holds threat of breaking up Google

#55

Post by ocdtrekkie »

kuschku wrote: post #46
matthewmacleod wrote: post #12

Earlier quoted context omitted.

Which regulations have "resulted in low investment and slow innovation"?

Not regulations, incompatible regulations. If you create a startup in SV, you can easily sell to the whole US. In the EU, you’ll need to obey 28 different laws, 28 different standards, and file 28 different tax forms. This is currently the single biggest hurdle for startups in the EU. The second, of course, is that people seem less willing to throw billions at risky concepts just so one maybe gets big enough.

Given how much of EU's economic law is managed centrally, is this drastically more significant than say... the 50 different states' regulations that US companies have to follow and contend with?

Re: EU competition chief holds threat of breaking up Google

#56

Post by throwaway4719 »

csomar wrote: post #31
throwaway4719 wrote: post #30

Earlier quoted context omitted.

That's one part of the negotiation puzzle. EU would want it's citizens to retain access to their google-hosted emails. Legally speaking, I'm sure there's plenty of ways the EU can force Google to do things it currently does not want to do. I'd say the EU has lots of negotional angles currently to win things from Google. That is kind of what you get when you have more or less universal legislation power over 40% or so…

> That is kind of what you get when you have more or less universal legislation power over 40% or so of the world's purchasing power (please correct me, I just bullshitted that guess). Europe GDP is 20.9 Trillion USD. The world GDP is 107 Trillion USD. So Europe is only 20% of the world GDP. But one can make the argument that EU citizens are better connected and spend more on digital goods. Though I'd be surprised if…

Alphabet Inc. break their revenue down into:

EMEA, APAC, Other Americas, US

Out of this, in 2017, EMEA was 32.5% of total revenue, based on numbers from page 33 of https://abc.xyz/investor/pdf/20171231_alphabet_10K.pdf.

My bullshit-guess is that out of those 32.5 percent units, EU/EES was responsible for about 31 units or so, and the rest 1.5 was from the middle east and africa. (Reasoning: the ME certainly has money, but no population to speak of. Africa has lots of people but besides relatively tiny South Africa very little revenue for Google.)

So yeah, the EU has a pretty powerful hammer.

Re: EU competition chief holds threat of breaking up Google

#57

Post by [deleted] »

csomar wrote: post #31
throwaway4719 wrote: post #30

Earlier quoted context omitted.

That's one part of the negotiation puzzle. EU would want it's citizens to retain access to their google-hosted emails. Legally speaking, I'm sure there's plenty of ways the EU can force Google to do things it currently does not want to do. I'd say the EU has lots of negotional angles currently to win things from Google. That is kind of what you get when you have more or less universal legislation power over 40% or so…

> That is kind of what you get when you have more or less universal legislation power over 40% or so of the world's purchasing power (please correct me, I just bullshitted that guess). Europe GDP is 20.9 Trillion USD. The world GDP is 107 Trillion USD. So Europe is only 20% of the world GDP. But one can make the argument that EU citizens are better connected and spend more on digital goods. Though I'd be surprised if…

[deleted]

Re: EU competition chief holds threat of breaking up Google

#58

Post by cryptonector »

tbirrell wrote: post #3

Does the EU even have the authority to break up Google/Alphabet?

It can ban them from operating in the EU unless they break up. The U.S. can also just break them up without a threat of banning them to get there. But certainly the EU have plenty of leverage.

Re: EU competition chief holds threat of breaking up Google

#59

Post by kuschku »

ocdtrekkie wrote: post #55
kuschku wrote: post #46

Earlier quoted context omitted.

Not regulations, incompatible regulations. If you create a startup in SV, you can easily sell to the whole US. In the EU, you’ll need to obey 28 different laws, 28 different standards, and file 28 different tax forms. This is currently the single biggest hurdle for startups in the EU. The second, of course, is that people seem less willing to throw billions at risky concepts just so one maybe gets big enough.

Given how much of EU's economic law is managed centrally, is this drastically more significant than say... the 50 different states' regulations that US companies have to follow and contend with?

I’m not quite sure, but I know that in the US many companies "forget" about sales tax if they’re located in a state without, without much trouble.

In the EU, VAT compliance can definitely become an issue, especially with small projects.

Not so much an issue for VC startups, but definitely one for bootstrapped ones. The only way to get a large enough market to survive is to sell to the entire EU, but that means much more work with VAT compliance, and translations.

Re: EU competition chief holds threat of breaking up Google

#60

Post by protomyth »

kuschku wrote: post #41
cf498 wrote: post #34

Earlier quoted context omitted.

And that place is called the US. This didnt even work when it was simply a question of having transnational companies on the level of facebook having to pay taxes.

And then there’s other solutions you can do. E.g., seizing Google’s copyrights and patents, and selling EU usage rights for them. Or seizing the physical hardware, and selling them (and the software on them) off. There’s many many solutions here. In the past, european governments have already seized airplanes from airlines upon landing, and threatened to auction them off, to pay a single unpaid $500 ticket return fin…

> E.g., seizing Google’s copyrights and patents, and selling EU usage rights for them. Or seizing the physical hardware, and selling them (and the software on them) off.

The retaliation from the US government on that one would be pretty epic. I wouldn't want to be an owner of a patent heavy European company at that point. Our current President is quite familiar with eminent domain.

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