EU imposes Google’s record fine of 4.34 billion euros on Android abuse of power

Jul

18

2018

European Commission has imposed a record fine of 4.34 billion euros on Google. The Commission considers that Google is abusing its dominant position with Android and demands that Google stop the infringements. Google appeals against the decision.

Margrethe Vestager, European Commissioner for Competition, announced the amount of the fine via Twitter . She writes that Google is guilty of three different competition infringements. In 2016 , the Commission published its preliminary observations in the current case. Then the EU body said that Google violated the competition rules by requiring manufacturers to install services such as Google Search and the Chrome browser in advance, by requiring that they do not release competing Android-based operating systems, and by rewarding manufacturers and providers for the exclusive installation of Google Search on their devices. This view is unchanged . Google responded at the time by stating that supplying apps is necessary for investments in Android.

The highest fine that the Commission can impose amounts to ten percent of the annual turnover of a company. In the case of Google, the maximum fine was therefore 10.9 billion dollars, about 9.4 billion euros. We look at the worldwide annual turnover of parent company Alphabet.

The Commission can start an investigation for various reasons, for example on its own initiative or on the basis of complaints. The organization Fairsearch said in 2016 that it had filed a complaint regarding Android. This organization, which includes Oracle, Nokia and Microsoft until the end of 2015 , has been in the spotlight for a long time, because the company would oppose competition in the field of search engines.

Statcounter calls a market share of 91.33 percent for Google’s search service in Europe and 93.4 percent for mobile devices in the same region. The share of Chrome would amount to about 59 percent , with about 64 percent on mobile devices. The European Commission said in 2016 that Google has a market share of more than 90 percent in the markets for general search services, mobile operating systems with licenses and app stores for Android.

The current case is not the only one in which the Commission investigates the conduct of the American search giant. In a previous case involving Google Shopping, the Commission has now imposed a fine of $ 2.4 billion for the benefit of its own price comparison in the search results of its search service. Google then announced that it appeals against this fine. Vestager said in March of this year that splitting Google is among the options to contain the company’s power.

The third case has to do with Google’s AdSense. The essence of this case is that, in the past decade, Google has, according to the Commission, infringed the competition rules through its AdSense platform, by imposing certain conditions in agreements with a limited number of large third parties. It specifically concerns search ads that appear after users have searched for something on websites that use a custom search engine from Google.

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