Google DMA fine becomes Europe's largest at €890 million

The Google DMA fine has reached €890 million after the European Commission penalized the company for two alleged breaches of the European Union's Digital Markets Act. The decision is now Europe's largest DMA penalty, surpassing Alibaba's mark by €340 million only four days after the Chinese e-commerce company held the top spot.

The penalty is split across two findings. The Commission imposed €460 million, about $523.5 million or £393 million, over Google's treatment of its own services in search results. A further €430 million, about $490 million or £367.5 million, relates to obligations tied to the Google Play app store.

Why did the EU fine Google under the DMA?

The Commission said Google favored its own offerings in Search, including shopping, hotel, transport and sports results, over competing services from third parties. According to the regulator, Google gave its services more visible placement and richer presentation, including top-of-page positioning, enhanced visuals and filters, while rival services did not receive comparable treatment.

The Play finding centers on the DMA's rules for app-store operators. The law requires operators to allow developers to tell customers about third-party app stores or other distribution channels that may offer cheaper ways to get software. EU regulators concluded that Google had not met that obligation.

For technology companies that depend on search placement or mobile distribution, the order is another signal that the Commission is willing to price DMA non-compliance at levels that are visible even for the largest platform companies. The rules are aimed at gatekeeper conduct, including how dominant platforms rank their own products and how tightly they control customer relationships inside app stores.

How large is the penalty for Alphabet?

In dollar terms, the combined fines total about $1.013 billion. That is a large bill in absolute terms, but small against Alphabet's last full-year financials: the company reported $402 billion in revenue and $132 billion in net income for that period. The fine equals roughly one quarter of one percent of revenue and less than one percent of profit.

Alphabet's stock fell about 10 percent this week. The DMA order adds to the pressure, though the share move also came alongside news that Alphabet burned cash for the first time in 20 years while funding AI investments. The fine is material for EU enforcement optics, but it does not alter the scale of Alphabet's core business on its own.

What is Google changing?

The Commission said Google has proposed and started testing changes to how its own services appear in Search. Regulators described those steps as meaningful progress toward compliance and said they would monitor how the changes are implemented.

Google has also made changes intended to give Play users more information about alternative software marketplaces. The Commission said those steps will be assessed against the cease-and-desist order attached to the decision.

The search remedy is also moving into Google's AI products. The Commission has begun discussions with Google about how the order applies to AI Overviews and AI Mode, search features that show fewer links than standard Google Search and are already generating more revenue for Google.

Google opposes the decision. The company argues that the ruling weakens its services and makes Play less secure. The Commission's position is that Google must change both Search presentation and Play disclosure practices to comply with the DMA.

This story draws on original reporting from The Register.