It took a three year investigation, but the European Union on Wednesday imposed a $5 billion fine on Google for breaching the bloc’s competition rules with its Android operating system.
The massive company is accused of abusing its dominant position in the market by making tie-ups with phone makers like South Korea’s Samsung and China’s Huawei. This effectively blocked rivals and hindered competition. The company has been given 90 days to end this practice or face more fines.
The European Commission has complained for a long time that Google requires manufacturers to pre-install its search engine and Google Chrome browser on phones. They also must set Google Search as the default, a condition of licensing some Google apps like Google Play.
“Google has used Android as a vehicle to cement the dominance of its search engine. This is illegal under EU antitrust rules.” Said EU Competition Commissioner Margrethe Vestager in a statement.
According to European Union rules, Google could have been fined up to 10 percent of parent company Alphabet’s annual revenue, which hit $110.9 billion in 2017.
This decision comes in the midst of fears that a transatlantic trade war is mounting due to President Donald Trump’s surprising decision to increase tariffs on European steel and aluminum imports. It also comes just one week before European Commission head Jean-Claude Juncker is due to travel to the US for sensitive talks on the tariffs dispute.
Vestager has been very outspoken and targeted a series of Silicon Valley giants like Apple and Amazon in her four years as the blocs’s antitrust chief. She has won praise in Europe but has angered Washington.
Android is the world’s most-used smartphone operating system and runs on about 80 percent of mobile devices worldwide. The open-source software is given to manufacturers for free. Google gets revenue from advertising displayed in its apps.
This latest complaint was formally lodged in April and also accuses Google of preventing manufacturers from selling smartphones that run on rival operating systems based on the open source Android code.
Share this:
