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Google Android Businesses EU

EU Regulators Fine Google Record $5 Billion in Android Case (reuters.com) 468

The European Union hit Alphabet's Google with a record antitrust fine of $5.06 billion on Monday, a decision that could loosen the company's grip on its biggest growth engine: mobile phones. From a report:The European Commission ordered Google to end the illegal conduct within 90 days or face additional penalties of up to 5 percent of parent Alphabet's average daily worldwide turnover. The EU enforcer also dismissed Google's arguments citing Apple as a competitor to Android devices, saying the iPhone maker does not sufficiently constrain Google because of its higher prices and switching costs for users. The European Commission finding is the most consequential decision made in its eight-year antitrust battle with Google. The fine significantly outstrips the $2.8B charge Brussels imposed on the company last year for favoring its own site in comparison shopping searches. The decision takes aim at a core part of Google's business strategy over the past decade, outlawing restrictions on its Android operating system that allegedly entrenched Google's dominance in online search at a time when consumers were moving from desktop to mobile devices. Android is the operating system used in more than 80 per cent of the world's smartphones and is vital to the group's future revenues as more users rely on mobile gadgets for search services. Google has denied wrongdoing.

The European Commission took issues with the following practices: In particular, Google:
1. has required manufacturers to pre-install the Google Search app and browser app (Chrome), as a condition for licensing Google's app store (the Play Store);
2. made payments to certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices;
and 3. has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks").
Update: Google has announced that it would be appealing against the record fine. In a statement, the company said, "Android has created more choice for everyone, not less. A vibrant ecosystem, rapid innovation and lower prices are classic hallmarks of robust competition. We will appeal the Commission's decision."

Update 2: In a blog post, Sundar Pichai, CEO of Google, said, the European Commission's decision ignores and misses several facts. He wrote: Today, the European Commission issued a competition decision against Android, and its business model. The decision ignores the fact that Android phones compete with iOS phones, something that 89 percent of respondents to the Commission's own market survey confirmed. It also misses just how much choice Android provides to thousands of phone makers and mobile network operators who build and sell Android devices; to millions of app developers around the world who have built their businesses with Android; and billions of consumers who can now afford and use cutting-edge Android smartphones. Today, because of Android, there are more than 24,000 devices, at every price point, from more than 1,300 different brands, including Dutch, Finnish, French, German, Hungarian, Italian, Latvian, Polish, Romanian, Spanish and Swedish phone makers.

[...] The free distribution of the Android platform, and of Google's suite of applications, is not only efficient for phone makers and operators -- it's of huge benefit for developers and consumers. If phone makers and mobile network operators couldn't include our apps on their wide range of devices, it would upset the balance of the Android ecosystem. So far, the Android business model has meant that we haven't had to charge phone makers for our technology, or depend on a tightly controlled distribution model. [...] Rapid innovation, wide choice, and falling prices are classic hallmarks of robust competition and Android has enabled all of them. Today's decision rejects the business model that supports Android, which has created more choice for everyone, not less. We intend to appeal.
Update 3: The French government said on Wednesday that it welcomes the record fine imposed on Google by European Union regulators, with a government spokesman describing it as an "excellent decision."
A number of companies, and startups that compete with Google have weighed in on the development. Open Markets Institute Executive Director Barry Lynn, said, "We hope U.S. enforcers of competition law will learn from and follow this example in both of these cases." Consumer Watchdog Director John Simpson, said, "The U.S. Federal Trade Commission or Department of Justice should also act to end Google's monopolistic abuses, instead of letting the Europeans be the only cop on the antitrust beat." Yelp SVP Public Policy Luther Lowe, said, "The European Commission's ruling of additional illegal conduct by Google on smartphones is another important step in restoring competition, innovation and consumer welfare in the digital economy; the EU must ensure complete compliance from a recalcitrant Google and the U.S. must take action to provide American consumers with similar protections."

Elevation Partners' Roger McNamee, said, Commissioner Vestager's ruling today not only enhances competition and investment opportunities in Europe, but it will have a cascading effect into U.S. markets, where antitrust enforcers have so far failed to take meaningful action." Privacy startup Disconnect CEO Casey Oppenheim, said, "Other players in the digital ecosystem may finally be able to fairly compete with Google, giving meaningful choice to consumers."
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EU Regulators Fine Google Record $5 Billion in Android Case

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  • New Improved Summary (Score:5, Informative)

    by bestweasel ( 773758 ) on Wednesday July 18, 2018 @07:46AM (#56967216)

    Here's a clearer summary of what Google have been up to as reported by The Guardian [theguardian.com].

    EU Competition commissioner Margrethe Vestager says:

    Google required manufacturers to pre-install the Google search and browser apps on Android phones, otherwise they wouldnâ(TM)t be allowed to use Google Play (its app service).

    Google paid manufacturers and network operators to make sure that only the Google search app was installed on devices.

    Google has restricted the development of competing mobile phone operating systems, which could have provided a platform for rival search engines.

    Google has used Android as a vehicle to cement its dominance as a search engine.

    These practices have denied rivals a chance to innovate and to compete on the merits.

    They have denied European consumers the benefit of effective competition in the very important mobile sphere.

    And this is illegal under EU antitrust rules.

    Todayâ(TM)s ruling states:

    Google has prevented device manufacturers from using any alternative version of Android that was not approved by Google (Android forks).

    In order to be able to pre-install on their devices Googleâ(TM)s proprietary apps, including the Play Store and Google Search, manufacturers had to commit not to develop or sell even a single device running on an Android fork.

    The Commission found that this conduct was abusive as of 2011, which is the date Google became dominant in the market for app stores for the Android mobile operating system.

    • by tsa ( 15680 )

      Wow what a déja-vue! For those of you who are too young to remember: MS did exactly the same in the 1990s.

    • by jwymanm ( 627857 )
      Really I think Microsoft slaughtering Nokia had more of an effect than Google's supposed anti competition tactics. You just need a good company that can develop both software and hardware. You have that in Apple, you had that in Nokia. You barely have that in Google.
      • by Raenex ( 947668 )

        Google's supposed anti competition tactics

        So why can't I have access to the Google Play store without Google's search bar? Don't you think that's Google flexing their Android market dominance to keep their search dominance?

    • by tsstahl ( 812393 )

      Here's a clearer summary of what Google have been up to as reported by The Guardian [theguardian.com].

      EU Competition commissioner Margrethe Vestager says:

      Google required manufacturers to pre-install the Google search and browser apps on Android phones, otherwise they wouldn't be allowed to use Google Play (its app service).

      We need the browser and search engine for guaranteed compatibility with the app store; it is the only way to give the user a consistent experience.

      Google paid manufacturers and network operators to make sure that only the Google search app was installed on devices.

      Giving marketing dollars for co-branded advertising is an old and well accepted practice across the world. Just look at Intel!

      Google has restricted the development of competing mobile phone operating systems, which could have provided a platform for rival search engines.

      Restricted? Positive steps to better compete in a crowded marketplace is now illegal?

      Google has used Android as a vehicle to cement its dominance as a search engine.

      We provide users with a consistent predictable experience on devices issued by HUNDREDS of different providers. Tight integration is a simple necessity

  • by c6gunner ( 950153 ) on Wednesday July 18, 2018 @07:57AM (#56967258) Homepage

    3. has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks").

    I'll be interested to see how this affects Google's newest decision to "disallow" google apps from being installed on custom ROMs without jumping through hoops, or, more boradly, the blocks which have been in place for ages preventing certain apps (like Netflix) being installed on unapproved devices.

    • I'll be interested to see how this affects Google's newest decision to "disallow" google apps from being installed on custom ROMs without jumping through hoops

      It won't affect that at all, because this is about Google bundling. This is about Google forcing people to use their software, not about forcing Google to let other people to use their software. It's the opposite thing.

      or, more boradly, the blocks which have been in place for ages preventing certain apps (like Netflix) being installed on unapproved devices.

      It will affect that even less; that has to do with licensing and DRM.

  • by Tom ( 822 ) on Wednesday July 18, 2018 @08:21AM (#56967334) Homepage Journal

    I have such a Deja Vu with respects to this case and the Microsoft anti-trust case. There it was browser, here it is search, but the methods are so similar.

    Until today I thought Google might be of a different breed than Microsoft. I stand corrected.

    • by zifn4b ( 1040588 )
      Absolute power corrupts absolutely
    • Until today? This was their whole purpose for creating Android-- to dominate mobile search. Some of their listed policies do make me feel like they are just microsoft 2.0 or something, but it is just confirmation.

  • Oh yeah, could it be (drumroll) having OEM computer manufacturers install Internet Explorer by default without a way to effectively remove it? It's ironic what's happened to IE/Edge these days though. :)
    • Oh yeah, could it be (drumroll) having OEM computer manufacturers install Internet Explorer by default without a way to effectively remove it?

      That's not even the problem. The USER can change the device's search engine easily enough. However, Google was prohibiting vendors from shipping any devices with e.g. CyanogenMod or AOSP if they also wanted to ship any devices with full corporate Android and the Play Store/Services. That's not like bundling IE, that's like when Microsoft offered OEMs a lower price for bundled Windows if they promised not to ship any machines with any other OS on them — or in some cases, even without an OS. It was thus

  • by I am Jack's username ( 528712 ) on Wednesday July 18, 2018 @08:48AM (#56967464)

    https://restoreprivacy.com/goo... [restoreprivacy.com]

    I've always felt it unethical to use the products of a company that makes money from advertising https://www.youtube.com/watch?... [youtube.com] but this finding has really woken me up - this kind of behavior is why I started to boycott Microsoft decades ago

    Replacing GMail is gonna be a hassle and take a long time because I'm not using an independent domain. Weaning myself off YouTube is gonna super difficult.

    • by Anonymous Coward on Wednesday July 18, 2018 @09:43AM (#56967722)

      I've always felt it unethical to use the products of a company that makes money from advertising

      The company that owns Slashdot makes money from advertising. Why are you using Slashdot?

      Unfortunately for your principle, all of the news outlets linked by the summary are funded by advertising, as are all search engines you might use to find information about the article, and nearly all blogs you might read about it on. For that matter, nearly all browsers you might use to read it with are primarily ad-funded, including Firefox.

      Why does the advertising model dominate in tech? For the same reason it's been the dominant funding mechanism for TV, radio and newspapers, for centuries: because it is by far the lowest-friction way to monetize the attention of a mass audience. And, of course, monetization is necessary because people need to eat. Perhaps we'll move to a post-scarcity economy which decouples work from survival and then you'll be able to find products that are created without need for compensation. Until then, advertising provides a way for people to make a living by producing stuff that's free for everyone, and that's a good thing.

      While you're certainly welcome to avoid any company or products you like, I think your quest to avoid advertising-supported products is both doomed to failure, and fundamentally dumb.

    • Comment removed based on user account deletion
    • I've always felt it unethical to use the products of a company that makes money from advertising

      Because Google makes money from advertising, it doesn’t have to charge its search users. Watching advertising, or giving up demographic information, is your trade for free stuff, just as TV was in the days of broadcasting.

    • https://restoreprivacy.com/goo [restoreprivacy.com]...

      What a bunch of hypocrites. Restore privacy site uses third party tracking bugs with data sent to innocraft.cloud

      Reminiscent of all those GDPR sites containing Google and Facebook trackers with no warning or consent.

  • by Anonymous Coward on Wednesday July 18, 2018 @09:24AM (#56967614)
    I've been developing Android devices for many years and can tell you from first hand experience, Google has been getting away with a lot of anti-competitive practices and favoritism. Unless you are one of the top 5 brands in the world, they simply will not talk to you. No matter how hard you try or show willingness to pay, they will not "certify" Android devices from anyone but their close circle of suppliers, with whom they have very complex agreements. This is why a very high percentage of devices are sold without the Play store pre-installed. It also blocks other things from working, such as full support for the DRM used by Netflix, HBO, and many other VOD apps. You are given the freedom of choice to choose any brand, as long as it is the ones they allow you to choose from.
  • I just want a phone I can use, not one that uses me.

  • Google and Microsoft need to insist that they aren't monopolies.

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