Google Hits All-Time High While Facing $1 Billion Fine

google-logo-2012-i19Google (NASDAQ:GOOG) surfed to a new all-time high on a wave of market optimism on Tuesday. The search giant advanced 1.3 percent to $804 per share before simmering down slightly.

In the absence of direct positive catalysts, some observers are attributing the stock movement to growth trends in mobile use and Google’s increasingly successful efforts to monetize mobile activity. Bloomberg pointed out that on top of Google’s 41 percent share of all digital advertising revenue, the company claims a 53 percent share of the mobile ad market. This compares to Facebook (NASDAQ:FB), whose share rests at 8.4 percent.

Tuesday’s new all-time high punctuated a strong year to date for Google. The stock was up 9.6 percent through February 15, gaining considerable upward momentum after reporting earnings that came in ahead of expectations.

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But it’s not all good news for the tech company. Reuters reported that Google could face legal penalties of up to $1 billion in Europe…

Man Measuring MoneyNew regulatory architecture in Europe allows a single EU entity to penalize companies on behalf of every nation. What’s more, the new regime will have the authority to fine companies up to 2 percent of global revenue, which means more equitable but also potentially larger penalties. Google had 2012 revenue of approximately $50 billion, which would set Google’s penalty at $1 billion.

Google is in trouble with EU regulators because of its privacy policy. Watchdogs have indicated that they want to take “repressive” action against Google, alleging that its privacy policy infringes on the privacy of its users. Regulators are particularly upset that Google even refused to change its policy after being warned.

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In some ways, the case against Google is being used to set an example for other Internet companies with a heavy hand in data collection, like Facebook. A complex debate has emerged between users, regulators, and businesses about privacy rights and data ownership, and as it stands, no elegant solution has emerged. Regulators will obviously exercise what muscle they have to see that companies abide by their interpretation of fair data use.

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