Google 'fined $5bn' by European Union over Android

Angelica Greene
July 18, 2018

On Wednesday afternoon, Europe time, EU Competition Commissioner Margrethe Vestager announced the new fine: €4.34 billion which converts to $5 billion.

Regulators say Google has tilted the field in its favour by forcing smartphone makers to pre-install Google Search together with its Play Store and Chrome browser, sign agreements not to sell devices on rival Android systems and also pay smartphone makers to only pre-install Google Search on devices.

"Google's practice has therefore reduced the incentives of manufacturers to pre-install competing search and browser apps, as well as the incentives of users to download such apps".

The EU penalty was expected to exceed the 2017 fine because of the broader scope of the Android case, sources has said.

Google has argued that its practices have not reduced consumer choice.

The fine is the largest ever issued by the European Commission in an antitrust case and will surpasses the €2.42bn penalty issued to the Silicon Valley firm a year ago.

A spokeswoman for Google did not immediately respond to an email seeking comment.

But the impact of the EU's decision to fine Google over Android dominance could be more than just monetary.

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Google said it will appeal against the levy.

Vestager has also ordered a series of measures against other US companies over tax practices in some European Union states, notably demanding two years ago that the Irish government take back up to 13 billion euros from Apple Inc (AAPL.O).

Secondly, that Google has made payments to certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices.

"Android hasn't hurt competition, it's expanded it", Kent Walker, Google's general counsel, wrote in a 2016 blog post rebutting the EU's initial charges. The commission found that while manufacturers were interested in Amazon's operating system, Google's restrictions meant that it could only launch on Amazon devices.

The EU's competition office, which has earned a reputation under Ms Vestager for tackling American technology giants, also has an ongoing investigation into Google's advertising business AdSense.

Though $5 billion is a lot of money for anyone, Google would no doubt recover quickly from the fine.

Those contracts might also prevent device makers from using other versions of Android on their devices.

On Wednesday, Vestager told a news conference in Brussels she "very much" likes the United States. Google will account for a third of all global mobile ads in 2018, according to research firm eMarketer, giving the company around $40 billion in sales outside the US Google risks losing that traction if it is forced to surrender its real estate on millions of Android phones.

Other reports by GizPress

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