Google Hit With Massive 4.3 Billion Euro Penalty Over Android
Google has just been slapped with a record-breaking 4.3 billion euro fine, as the Silicon Valley giant stands accused of illegally using its dominant position with Android to push its online search services to mobile devices. The fine comes to around almost 5 billion US dollars, a penalty that Google parent company Alphabet plans to appeal.
Android has been an overwhelming majority in the mobile space for a few years now, with the operating system used in more than 80 percent of smartphones and mobile devices worldwide, as the Financial Times pointed out.
This lion's share of the market has been abused by Google, according to the European Commission, with Google using it to leverage deals with smartphone makers. The body has deemed Google's tie-in arrangements with manufacturers where they pre-install Google's search app and Chrome browser in their phones as "illegal."
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"In this way, Google has used Android as a vehicle to cement the dominance of its search engine," Margrethe Vestager, the EU's competition commissioner, said about these arrangements.
"These practices have denied rivals the chance to innovate and compete," she added.
Google CEO Sundar Pichai has posted a blog post in response to the decision, arguing that "Android has created more choice, not less." In his post, Pichai argues that Android has enabled phone makers to run the same applications, leading to users installing more apps to replace any of the preloaded ones.
He also countered that the Google apps that phone makers would often preload into their devices also help consumers by making sure that their devices "'just works', right out of the box."
"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," Pichai wrote in the end.
