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Antitrust Charges Against Abusive Android

Antitrust Charges Against Abusive Android

by Adrian Ababei on Apr 27 2016

The European Commission on Wednesday charged that Google breached EU antitrust rules by seeking to maintain and expand the dominance of its Android operating system. "A competitive mobile Internet sector is increasingly important for consumers and businesses in Europe," said the EC's antitrust chief, Margrethe Vestager. "Based on our investigation thus far," she continued, "we believe that Google's behavior denies consumers a wider choice of mobile apps and services and stands in the way of innovation by other players, in breach of EU antitrust rules."

Throttling Competition

In its statement of objections, the commission alleged Google violated EU antitrust rules in the following ways: • Requiring manufacturers to preinstall Google Search and Google's Chrome browser and requiring them to set Google Search as default search service on their devices, as a condition to license certain Google proprietary apps; • Preventing manufacturers from selling smart mobile devices running on competing operating systems based on Android open source code; and • Giving financial incentives to manufacturers and mobile network operators on condition that they exclusively preinstall Google Search on their devices. Google's business practices may lead to a further consolidation of the company's dominant position in general Internet search services, the commission noted. Those practices may affect the ability of other mobile browsers to compete with Google Chrome. They hinder the development of operating systems based on Android open source code and the opportunities they would offer for the development of new apps and services, the commission said.

Internet Explorer Redux

The commission's action is a response to complaints it has received from Google's competitors in Europe. In 2013, FairSearch Europe, a group that includes Oracle and Nokia, filed a complaint with the EC about Android. In 2014, Aptoide also filed a complaint. Consumer Watchdog is another group supporting an investigation into Google's Android dominance. "This is the same kind of thing that Microsoft did when it bundled its browser in with its operating system," said John M. Simpson, director of Consumer Watchdog's Privacy Project. "While Google makes Android freely available, it's got strings that come with it that unfairly favor Google's apps if you're going to use the Android software," he told the E-Commerce Times. "Consumers can go and find other apps and install them," Simpson added, "but that gives Google a leg up on Android devices."

Unfortunate Action

Google is not stifling the Android marketplace, according to Daniel Castro, a senior analyst with the Information Technology & Innovation Foundation. "This is an unfortunate action because it does not seem like there has been any consumer harm from the allegations and there is strong competition in the mobile OS environment," he told the E-Commerce Times. "It is hard to see how Google can lock out any competitors since the switching costs of installing a new app are so minimal -- 30 seconds to download and install a rival app," Castro said. One reason Android enjoys widespread popularity is its openness, he explained, which allows for experimentation while also providing standardized features across platforms for users. "It would be unfortunate if the EU punishes Google for actions it takes that create better consumer experiences because it believes these actions are anticompetitive," Castro said. "This would create a risk," he continued, "that tech companies would design products to meet arcane competition regulations rather than consumer needs."

U.S. Probe

Since the Europeans announced their initial probe into Google's Android monopoly last year, there have been murmurs of a similar investigation by the U.S. Federal Trade Commission. In September, for example, Bloomberg reported that the FTC had reached an agreement with the U.S. Justice Department to investigate whether or not Google was stifling access to Android by its competitors. That wouldn't be the first time the FTC probed Google. It looked into Google's search dominance in 2011 and 2012. That investigation ended in 2013 with Google changing some of its business practices. However, last year The Wall Street Journal reported that the commissionignored the advice of key staffers to sue Google because they believed it was doing harm to consumers and innovation. "The FTC completely blew its investigation on the search monopoly," Consumer Watch's Simpson said. "They completely failed to do their job there." In 2014, Google spent US$16.8 million on lobbying in Washington, he added. "You don't spend money like drunken sailors on lobbying unless you see results."

Source: http://www.technewsworld.com

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