The Financial Times [behind paywall] is reporting that the European Commission is set to penalize Google over issues that bother on antitrust. Europe’s regulatory body is set to impose a hefty fine on Google for alleged misuse of power in respect to Android licensing deals with third-party phone makers. Citing the EU Competition Chief Margrethe Vestager, the regulatory body is “poised to announce the negative finding within weeks . . . marking the most significant regulatory intervention made against Google’s business model.”
The EU is claiming that Google’s app-install requirements in Android-OEM contracts are constructed to favor Google, while harming the choice of the consumer. Based on the FT report, Google could receive a hefty fine as high as $11 billion; though there is a possibility of a lesser fine.
Though, the fine has not been applied yet, it is most likely that Google would appeal the EU decision, which won’t come as a surprise at the end of the day considering previous events.
This time last year, the European Commission in charge of competition fined Google a whopping sum of €2.42 billion or $2.7 billion for abusing its “dominance as search engine.” The hefty fine by the European regulatory commission didn’t come to many as a surprise. The commission said its decision was hinged on Google’s “abuse of dominance as search engine by giving illegal advantage to own comparison shopping service.”
Google has come up with many innovative products and services that have made a difference to our lives. That’s a good thing. But Google’s strategy for its comparison shopping service wasn’t just about attracting customers by making its product better than those of its rivals. Instead, Google abused its market dominance as a search engine by promoting its own comparison shopping service in its search results, and demoting those of competitors, said Margrethe Vestager.
She maintained that what Google did was unacceptable because it denied competition the opportunity to compete.
What Google has done is illegal under EU antitrust rules. It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation.”
In July 2016, the regulators slammed more charges on Google—extending its investigation beyond search to AdSense and AdWords. The additional charges brought against Google was the clearest indication yet that the end was not in sight as it concerns the EU’s investigation.
Yet more worries for Google…
Delivering a speech at a conference held in the Netherlands in 2016, Vestager said the Commission was “closely” monitoring the Google’s contract with carriers and mobile manufacturers. The Commission’s concern is aimed at requirements Google places on its partners to have devices pre-installed with its apps. “Our concern is that, by requiring phone makers and operators to pre-load a set of Google apps, rather than letting them decide for themselves which apps to load, Google might have cut off one of the main ways that new apps can reach customers,” Vestager said.