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The European Union will hit Google with a record fine of 4.3 billion euros ($ 5.1 billion) for antitrust issues related to Google's management of the Android ecosystem .
The expected fine is the highest ever record high of 2.4 billion euros raised against Google last year for its online shopping service. But even with that, it is expected that the fine only represents two weeks of revenue for the search engine giant, making it barely more than a pat on the wrist .
However – and more importantly for Google – the EU has also given Google 90 days to abandon the actions that the EU has deemed illegal, or it will face other fines from the part of the European Commission.
A Google spokesman told Digital Trends: no less. A vibrant ecosystem, rapid innovation and lower prices are the classic features of vigorous competition. We will appeal the decision of the Commission. "Google CEO Sundar Pichai supported this statement on Twitter also adding that the existence of Android has led to stiff competition in a blog on the subject." Concerned for Android users everywhere, Pichai said that today 's decision could change the way Android is used as we know it. "In 2007, we chose to offer Android to phone manufacturers and to mobile network operators for free. Of course, there are costs involved in building Android, and Google has invested billions of dollars over the last decade to make Android what it is today. now … we only earn revenue if our applications are installed, and to use our applications instead of rival applications "Pichai wrote.
What is this? In addition to ensuring that all Android has a unifying section of applications that users can always know, Google's insistence on using its apps meant that Google could win money from what is essentially a free service. "Without being able to guarantee that Chrome and Google are still installed and used, Google can no longer count on Android.This could mean the beginning of a paid Android service. for manufacturers – which could mean t more expensive phones for users.
Why does the EU impose fines on Google?
Brussels accuses Google of using its position of strength on the market to unfairly keep its own search engine in a predominant position and offer a reduction in search profits to manufacturers and telecom providers who exclusively install Google's search engine on their devices. about 95% of the search engine market on Android devices, while Android accounts for 80% of the smartphone market. The survey looked into the use of search engines on Windows phones and found that Google's use as a search engine dropped to only 25% – which implies for the EU that pre-installed Google search gives it a considerable advantage.
Google's requirements as one of the reasons behind the failure of Amazon's Fire OS mass market. According to the survey, Google has threatened to remove the Play Store authorization from any manufacturer who has created a single device running an unauthorized version of Android Android, also known as the Android "fork" . Since Fire OS is an Android fork, the EU claims that Google's actions have violated EU law and leads directly to the failure of Fire's operating system. 39; Amazon.
This action by the European Commission is not a shock some. "Google has always been a contradiction in that it is a market facilitator who also wants to control this market," says Mark Skilton, a professor of practice in the Warwick Business Information and Management Systems. School. "Google claims that it has to compete with other big players and that the exchange to an alternative search service is" one-click ", but in my opinion it's the lock-in. About 80% of mobile devices with preinstalled Google Android software. "
While device manufacturers are not required to access Google's requests to use the system of Google. Android operating – Amazon's Fire tablets run a forked version of Android that does not have access to the default Play Store – expects most Android devices want to have access at the Play Store
The requirements that Google must follow
The European Commission having declared that Google's actions were illegal, Google now has 90 days to comply with the requirements of the EU, or face other costs. made at the conference, these additional costs could reach 5% of the parent company's daily income Alphabet
Requirements:
- Google must stop dictating which search and browser applications are pre-installed on Android Google needs stop the anti-competitive agreements involving the exclusivity of the Google search
- Google must stop restricting the development of new open-source versions of Android
It is not clear for the l & # 3939; moment if the requirements would apply to current Android devices, or would simply apply to Android devices released after this decision.
Google is not the first company to have been hit by harsh regulations on anti-consumer practices in the EU. Microsoft has already been fined by the European Commission for similar practices and has been forced to force consumers to use specific web browsers.
Google has already been sentenced to two fines for antitrust issues. AdSense is also problematic – expect to see serious changes in EU legislation in response to what legislators perceive as imbalances in technology markets. US regulators have not always done as much to regulate big companies like Google or Microsoft.
Where is the money going?
But fine Google, that's fine, but what happens after Google?
Margrethe Vestager, European Commissioner for Competition, asked this question when announcing the fine, and it is actually a fairly simple process.
Today, we have fined Google 4.34 billion euros for violating antitrust rules. Where is the money going? Commissioner @vestager explains how antitrust fines are collected and used ↓ pic.twitter.com/RJrx4hoTU2
– European Commission ???????? (@EU_Commission) July 18, 2018
After being removed from Google, the money is placed in a closed account and held until all legal remedies have been heard. If the fine is maintained by the appeal process, the money is sent to the European Union, and from there is distributed among each member. The amount allocated to each country depends on the country's financial contribution to the EU, with major donors dropping as much as possible.
If the call was to cancel the fine, the money would then go back to Google, and vice versa.
Updated July 18: We have updated the article with details on what the Google CEO's blog post might mean.
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