What began as a preliminary investigation in Europe has just turned into a big headache for Google. The European Union has begun an official investigation into the search giant for alleged violations of Europe's antitrust laws. The investigation was spurred by complaints from competing search companies. Specifically, Google is accused of intentionally down ranking  their results in both paid ads, and regular searches.

Europe is taking these allegations seriously because Google owns over 80% of the search market there. While some of the complainants are small vertical search companies, they believe Google is intentionally suppressing their results. For example, Google is accused of giving preferential placement of its own services in search results, and keeping competitors' results lower. They also claim that Google restricts where ads for these competitors can be placed. 

If Google is found to have violated the law, the fines could be hefty. The penalty could be up to 10% of Google's global sales, which last year was $24 billion. A $2.4 billion fine would sting, even for Google.

According to an announcement made by the US Justice Department today, six major tech companies  - Apple, Intel, Google, Intuit, Pixar, and Adobe - have reached a settlement in an antitrust investigation. The case centered around an agreement that the companies had to not scoop up each other's employees. The Justice Department calls this "restrained competition" for employees. 

Several of these companies had agreements not to "cold call" employees of the other company with job offers. Some, like Google and Intuit, decided not to make offers to the other's employees at all. The settlement "prohibits the companies from engaging in anticompetitive no solicitation agreements." The catch, this will only be in effect for five years. At which time we could go through this whole process again. Additionally, a Judge still must approve the deal.

The Justice Department indicated some of these anticompetitive arrangements went back at least five years. They further stated that this investigation was necessary as it reduced the ability of high tech workers to compete for jobs. It was effectively salary-fixing.

It's no secret the EU's European Commission likes to hit companies with large fines for anti-competitive behavior. A new measure called the Digital Agenda looks to redefine how the Commission determines who is abusing their market position. The new language no longer requires  a company to have a "dominant" market position. Instead, a company need only be "significant" in the market.

Many are seeing this as a direct challenge to Apple's locked down iPhone platform. Commissioner Neelie Kroes recently said, " [A maker] cannot just choose to deny interoperability with their product." If the EU chooses to pursue a case against Apple, it could result in a hefty fine and possible changes in the way they do business in the EU.

We may see a future where Adobe Flash support is available on the iPhone. Apple has thus far refused to even consider supporting the Flash platform on their phone. Smaller players in the market, like Palm, may also have the option to sync with iTunes if the EU gets really up in arms.  Even if this does come to pass, the EU would only be enforcing it in Europe. Other regions could see little change. Do you think the EU is planning to go after Apple?