The European Commission has fined Google a record €4.3 billion (£3.9 billion) over what it claims are non-competitive practices related to its Android mobile operating system.
According to the body, the tech giant took advantage of its status – some 80 per cent of mobile gadgets in the EU run Android – to illegally “cement its dominant position” in search by requiring manufacturers to favour its own services over those used by competitors.
Competition Commissioner Margrethe Vestager highlighted three ways in which Google is alleged to have broken antitrust laws. Firstly, she claimed the company forced manufacturers of Android phones to preinstall the Google Search app and its Chrome web browser in order to gain access to the Google Play store – a feature that is vital in allowing users to browse and download apps.
This, it is claimed, resulted in a major disadvantage to developers of other search engines and browsers, as the majority of users will not look for alternatives to the default options they are presented with when they pick up a new phone.
Google is also alleged to have made payments to large manufacturers and mobile network operators that agreed to exclusively preinstall Google Search on their devices, as well as threatening to refuse access to the Google Play store to any smartphone maker that sold devices powered by alternative, 'forked' versions of Android.
Ms Vestager stated that mobile devices are responsible for more than half of global internet traffic, so it is vital that consumers are offered a choice in how they get online.
She added: “[Google's] practices have denied rivals the chance to innovate and compete on the merits. They have denied European consumers the benefits of effective competition in the important mobile sphere. This is illegal under EU antitrust rules.”
The ruling bears some similarities to a famous case involving desktop and laptops PCs brought by the EC against Microsoft in 2009. In that instance, the firm's practice of bundling its own Internet Explorer browser with new copies of the operating system was found to be similarly anti-competitive.
In addition to a large fine – a then-record €497 million, which is dwarfed by the Google judgement – Microsoft was forced to offer users of Windows 7 a choice of browser when they installed the operating system. It is thought that Google may have to take similar steps, which would mean owners of new Android devices would have to select the web browser and search engine of their choice.
The EC has given Google 90 days to make changes to its practices, but the company has said it will appeal the ruling.
Google's chief executive Sundar Pichai wrote in response: “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.”