General

EU Hits Google with Record Fine of $5 Billion for Android Antitrust Violations


Google has received a record-breaking $5bn fine from the European Commission over its use of the Android operating system. The Commission believes Google's mobile strategy has unfairly strengthened its dominance of internet searching. This is the largest fine imposed by a regulator against a single firm.

Fine of €4,34 bn to @Google for 3 types of illegal restrictions on the use of Android. In this way it has cemented the dominance of its search engine. Denying rivals a chance to innovate and compete on the merits. It’s illegal under EU antitrust rules. @Google now has to stop it

— Margrethe Vestager (@vestager) July 18, 2018

Google no stranger to hefty European Commission fines

Google has previously been ordered to pay a 2.4bn euro ($2.8bn) fine over its shopping comparison service by the Competition Commissioner, Margrethe Vestager. Google is in a processing of appealing this fine but maybe slugged with another before the first is even resolved.

That’s not the only problem the Commission has with Google, it is also investigating the practices of its advert-placing business AdSense as part of a separate inquiry. The ruling related to Android was expected earlier this month but had been delayed to avoid a clash with US president Donald Trump’s visit to Europe.

The commission began investigating Android after a complaint was lodged by Fairsearch, a trade group that originally included Microsoft, Nokia and Oracle among its members. The complaint initiated action by the commision to launched its official investigation in April 2015.

Tech giant dominates Europe's handset market

In 2015 it was estimated that Android had a 64% share of Europe's handset market, but that figure has now risen to 74%. The commision has made three specific allegations against Google:

Smartphone manufacturers are allegedly required to pre-install Google Search and Google’s Chrome browser on their devices and then set both as the default.

Smartphone makers are allegedly discouraged from releasing devices that are based on the Android open source code but not affiliated with the Google-owned property.

Smartphone makers are allegedly offered financial incentives to create handsets that come exclusively installed with Google Search on devices.

Google is expected to appeal the decision. "The commission's approach... would mean less innovation, less choice, less competition, and higher prices," Google’s global affairs chief said in a recent blog post.

Despite Google being adamant it isn’t doing anything wrong, it has already made some concessions in Russia where the consumer watchdog laid down similar claims.

In Russia, Android users are now offered a choice between Google, Yandex and Mail.ru as the default search engine the first time they use the Chrome browser.

Google has a long history of pushing back and it is likely to drag out its appeal against the fine.


Watch the video: EU slaps Google with a $5 billion anti competition fine (May 2021).