The European Commission fined Google yesterday (18 July) with a record amount of €4.34 billion. The reason is the tech giant’s abuse of its dominant market position. Following three years of investigation, the EU executive drew the conclusion that the company abused its market position and power to curb competition in search engines and browsers in the growing sector of mobile Internet.
This record fine was centered around Google’s Android – a free operating system that quickly spread over the market to control 80% of smartphones but included limitations for pre-installing competitors’ applications with focus on search engines. This is the second penalty for the US company based in Mountain View, California, following the €2.42 billion penalty in June 2017 for its online shopping service. “Google has used Android as a vehicle to cement the dominance of its search engine,” the EU Commissioner for Competition, Margrethe Vestager, explained, adding that “these practices have denied rivals the chance to innovate and compete on the merits.”
Google said that it would appeal the ruling. Its CEO Sundar Pichai commented that “a healthy, thriving Android ecosystem is in everyone’s interest, and we’ve shown we’re willing to make changes” but he remained concerned that the decision might send a problematic signal in favor of proprietary systems over open tools. The Commission confirmed that the investigations continue as a “top priority” into Google’s other tools – such as restrictions on the display of advertisements on third party websites and for possible additional breaches of competition rules. The battle between the EU and Google is thus hardly over and the list of penalties is likely to increase.