Patrick May: Google will barely feel multibillion-dollar slap on the wrist

June 28, 2017 by Patrick May, The Mercury News
Credit: CC0 Public Domain

Take THAT, Google!

And with those words, or perhaps a more formal and civilized version of those words, the European Union's commission in charge of competition policy (yes, that position exists) threw the book at the Silicon Valley search giant over its advertising practices on the continent.

Actually, it was only $2.7 billion, which for Google and its mega money bags is not really a "book" but maybe the Cliff Notes.

Google parent Alphabet's current market value is $580 billion, second only to Apple's market cap of $752 billion. According to Forbes, Google's brand value is $102 billion. And with the company's assets valued at $168 billion, that EU fine will probably seem more like a pesky fly than something that's going to rattle Google's bottom line.

The EU hit Google with the fine, which was a record, after it concluded that the company unfairly favored its comparison-shopping service over others. "Rubbish!" said Google, threatening to appeal the fine.

But let's place that penalty in perspective, shall we?

-Last year, Google CEO Sundar Pichai was paid a total compensation of nearly $200 million, which means he could pay off that EU fine in about 13 years - all by himself!

-If your average Google employee's base salary is (conservatively) around $120,000, and you have 62,000 employees, that $7.4 billion in take-home pay means if every worker would chip in one out of every two dollars they make this year, the fine could be settled by Christmas;

-For the quarter - yes, just the one quarter - ending on Dec. 31, 2016, Alphabet reported revenues of $26 billion, and the income it cleared after expenses could have easily taken care of the fine with enough left over for something like 289,000 company picnics;

-With Google handling 3.5 billion searches each day, and if we assume that that's 700 million different people around the world doing five searches each, and if the average per-capita income for the entire planet is around $27 a day, then all those Google searchers are making a combined daily salary of nearly $19 billion, which means that if each member of Google's global community would chip in a day's pay they could pay off that entire EU fine without breaking a sweat.

Explore further: EU fines Google a record 2.4 billion euros in antitrust case (Update)


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