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EU Regulators Fine Google Record $5 Billion in Android Case (reuters.com)
The European Union hit Alphabet's Google with a record antitrust fine of $5.06 billion on Monday, a decision that could loosen the company's grip on its biggest growth engine: mobile phones. From a report:The European Commission ordered Google to end the illegal conduct within 90 days or face additional penalties of up to 5 percent of parent Alphabet's average daily worldwide turnover. The EU enforcer also dismissed Google's arguments citing Apple as a competitor to Android devices, saying the iPhone maker does not sufficiently constrain Google because of its higher prices and switching costs for users. The European Commission finding is the most consequential decision made in its eight-year antitrust battle with Google. The fine significantly outstrips the $2.8B charge Brussels imposed on the company last year for favoring its own site in comparison shopping searches. The decision takes aim at a core part of Google's business strategy over the past decade, outlawing restrictions on its Android operating system that allegedly entrenched Google's dominance in online search at a time when consumers were moving from desktop to mobile devices. Android is the operating system used in more than 80 per cent of the world's smartphones and is vital to the group's future revenues as more users rely on mobile gadgets for search services. Google has denied wrongdoing.
The European Commission took issues with the following practices: In particular, Google:
1. has required manufacturers to pre-install the Google Search app and browser app (Chrome), as a condition for licensing Google's app store (the Play Store);
2. made payments to certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices;
and 3. has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks"). Update: Google has announced that it would be appealing against the record fine. In a statement, the company said, "Android has created more choice for everyone, not less. A vibrant ecosystem, rapid innovation and lower prices are classic hallmarks of robust competition. We will appeal the Commission's decision."
Update 2: In a blog post, Sundar Pichai, CEO of Google, said, the European Commission's decision ignores and misses several facts. He wrote: Today, the European Commission issued a competition decision against Android, and its business model. The decision ignores the fact that Android phones compete with iOS phones, something that 89 percent of respondents to the Commission's own market survey confirmed. It also misses just how much choice Android provides to thousands of phone makers and mobile network operators who build and sell Android devices; to millions of app developers around the world who have built their businesses with Android; and billions of consumers who can now afford and use cutting-edge Android smartphones. Today, because of Android, there are more than 24,000 devices, at every price point, from more than 1,300 different brands, including Dutch, Finnish, French, German, Hungarian, Italian, Latvian, Polish, Romanian, Spanish and Swedish phone makers.
[...] The free distribution of the Android platform, and of Google's suite of applications, is not only efficient for phone makers and operators -- it's of huge benefit for developers and consumers. If phone makers and mobile network operators couldn't include our apps on their wide range of devices, it would upset the balance of the Android ecosystem. So far, the Android business model has meant that we haven't had to charge phone makers for our technology, or depend on a tightly controlled distribution model. [...] 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. We intend to appeal. Update 3: The French government said on Wednesday that it welcomes the record fine imposed on Google by European Union regulators, with a government spokesman describing it as an "excellent decision."
A number of companies, and startups that compete with Google have weighed in on the development. Open Markets Institute Executive Director Barry Lynn, said, "We hope U.S. enforcers of competition law will learn from and follow this example in both of these cases." Consumer Watchdog Director John Simpson, said, "The U.S. Federal Trade Commission or Department of Justice should also act to end Google's monopolistic abuses, instead of letting the Europeans be the only cop on the antitrust beat." Yelp SVP Public Policy Luther Lowe, said, "The European Commission's ruling of additional illegal conduct by Google on smartphones is another important step in restoring competition, innovation and consumer welfare in the digital economy; the EU must ensure complete compliance from a recalcitrant Google and the U.S. must take action to provide American consumers with similar protections."
Elevation Partners' Roger McNamee, said, Commissioner Vestager's ruling today not only enhances competition and investment opportunities in Europe, but it will have a cascading effect into U.S. markets, where antitrust enforcers have so far failed to take meaningful action." Privacy startup Disconnect CEO Casey Oppenheim, said, "Other players in the digital ecosystem may finally be able to fairly compete with Google, giving meaningful choice to consumers."
The European Commission took issues with the following practices: In particular, Google:
1. has required manufacturers to pre-install the Google Search app and browser app (Chrome), as a condition for licensing Google's app store (the Play Store);
2. made payments to certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices;
and 3. has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks"). Update: Google has announced that it would be appealing against the record fine. In a statement, the company said, "Android has created more choice for everyone, not less. A vibrant ecosystem, rapid innovation and lower prices are classic hallmarks of robust competition. We will appeal the Commission's decision."
Update 2: In a blog post, Sundar Pichai, CEO of Google, said, the European Commission's decision ignores and misses several facts. He wrote: Today, the European Commission issued a competition decision against Android, and its business model. The decision ignores the fact that Android phones compete with iOS phones, something that 89 percent of respondents to the Commission's own market survey confirmed. It also misses just how much choice Android provides to thousands of phone makers and mobile network operators who build and sell Android devices; to millions of app developers around the world who have built their businesses with Android; and billions of consumers who can now afford and use cutting-edge Android smartphones. Today, because of Android, there are more than 24,000 devices, at every price point, from more than 1,300 different brands, including Dutch, Finnish, French, German, Hungarian, Italian, Latvian, Polish, Romanian, Spanish and Swedish phone makers.
[...] The free distribution of the Android platform, and of Google's suite of applications, is not only efficient for phone makers and operators -- it's of huge benefit for developers and consumers. If phone makers and mobile network operators couldn't include our apps on their wide range of devices, it would upset the balance of the Android ecosystem. So far, the Android business model has meant that we haven't had to charge phone makers for our technology, or depend on a tightly controlled distribution model. [...] 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. We intend to appeal. Update 3: The French government said on Wednesday that it welcomes the record fine imposed on Google by European Union regulators, with a government spokesman describing it as an "excellent decision."
A number of companies, and startups that compete with Google have weighed in on the development. Open Markets Institute Executive Director Barry Lynn, said, "We hope U.S. enforcers of competition law will learn from and follow this example in both of these cases." Consumer Watchdog Director John Simpson, said, "The U.S. Federal Trade Commission or Department of Justice should also act to end Google's monopolistic abuses, instead of letting the Europeans be the only cop on the antitrust beat." Yelp SVP Public Policy Luther Lowe, said, "The European Commission's ruling of additional illegal conduct by Google on smartphones is another important step in restoring competition, innovation and consumer welfare in the digital economy; the EU must ensure complete compliance from a recalcitrant Google and the U.S. must take action to provide American consumers with similar protections."
Elevation Partners' Roger McNamee, said, Commissioner Vestager's ruling today not only enhances competition and investment opportunities in Europe, but it will have a cascading effect into U.S. markets, where antitrust enforcers have so far failed to take meaningful action." Privacy startup Disconnect CEO Casey Oppenheim, said, "Other players in the digital ecosystem may finally be able to fairly compete with Google, giving meaningful choice to consumers."
This just an example of why the UK voted Brexit
I'm normally all for fining the crap out of mega-corps which show nothing but contempt for the rules, but I don't get this.
The truth is that people are choosing Google because their competitors are shit, or in the case of Apple even worse. What's the point here, Google are supposed to provide shit services that nobody wants to use so their competitors can prosper?
There is literally nothing that prevents anyone from setting up competing services other than the facts that it would be an insane amount of work and incredibly expensive, but that's not Google's problem. Android is even mostly open source, any would be competitors are free to just blatantly copy it. All they have to do is provide their own store, which one would imagine wouldn't be too hard. The hard part is to get people to use it in any significant number, but again, that's not Google's problem as long as they don't blatantly try to prevent it - which they aren't. Saying "you can't use our apps if you do that" doesn't cut it, you're still free to provide your own, or use someone else's. Making your alternatives competitive and getting people to use them are your problems, not Google's.
Google are where they are because they've built a solid reputation with consumers, not because they did something shady.
Perhaps you didn't manage to read even the summary? The $5 billion is just the start; [...] end the illegal conduct within 90 days or face additional penalties of up to 5 percent of parent Alphabetâ(TM)s average daily worldwide turnover. Note that that's turnover, not profit, and moreover it's worldwide turnover, not EU turnover. Even Google would feel that.
Sucks to be on the receiving end, no?
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
No, this is a way to force American companies who do business in EU to follow EU law. Unlike USA, where companies get a slap on the wrist for any wrongdoings and happily continue breaking the law, EU can actually apply leverage that works.
They don't have to pay, and they don't have to comply. They can just pack up and leave the EU market forever.
How many years did the US government take again to 'punish' MS for its misuse of its monopoly? 15? And it was a punishment that benefited MS in the long run! No wonder the monkey danced.
-- Cheers!
The EU has no tech industry ... because EU businesses have to follow EU laws. I don't think this is a good thing. But.
US companies can't just side-step local laws by claiming they are based outside the EU. They have got away with it for several years, and the EU is only now finally responsing.
Follow the law, or stop doing business with the EU. Your choice.
I've always felt it unethical to use the products of a company that makes money from advertising
The company that owns Slashdot makes money from advertising. Why are you using Slashdot?
Unfortunately for your principle, all of the news outlets linked by the summary are funded by advertising, as are all search engines you might use to find information about the article, and nearly all blogs you might read about it on. For that matter, nearly all browsers you might use to read it with are primarily ad-funded, including Firefox.
Why does the advertising model dominate in tech? For the same reason it's been the dominant funding mechanism for TV, radio and newspapers, for centuries: because it is by far the lowest-friction way to monetize the attention of a mass audience. And, of course, monetization is necessary because people need to eat. Perhaps we'll move to a post-scarcity economy which decouples work from survival and then you'll be able to find products that are created without need for compensation. Until then, advertising provides a way for people to make a living by producing stuff that's free for everyone, and that's a good thing.
While you're certainly welcome to avoid any company or products you like, I think your quest to avoid advertising-supported products is both doomed to failure, and fundamentally dumb.
So why isn't the response "fix these abusive practices, or be denied access to our market" rather than "give us a bunch of money".
1) It's a lot harder to justify a ban than a fine.
2) A fine doesn't put people out of work. In fact, government spending the money may employ people.
It's actually better for everyone, because the fines will induce Google to change their behavior (since they threaten additional fines, here) without causing people to lose their jobs.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
A 20% market share of 100% Apple manufactured phones vs 80% market share for Android spread across dozens of manufacturers, none of which can claim 20% of the market or anything close to Apple's profits. You're comparing Apples to Oreos and coming up with D'oh.
Apple is the sole provider of the operating system for Apple phones. Apple does not allow other people to manufacture iPhones, does not allow other App stores, does not allow other web browsers (They still have to use Safari's engine, so they're mostly skins). Apple conspired with book publishers to fix prices on ebooks. Apple is a monopoly, by every definition, and abuses it.
Comment removed based on user account deletion
EU Law....you assume that any laws were actually broken, rather than just throwing a fine out there to bring in money to the EU when no companies have been hurt. Have they thrown fines at Apple for not allowing other browsers to be put on iPhones sold in the EU market? How about email apps? Nope, they don't go after Apple, which is even worse about the rules about what goes on the iPhone.
Basic concept, third party phone makers might put malware in the custom apps they provide with the phone. You want to worry about spyware, yea, how about that weird browser that is only on a certain brand of phone? Google can easily call it protecting users by saying that all Android phones come with the official Google apps without modification. Having a search widget is such a minor thing, are companies complaining that THEIR search widget isn't being used because a Google version is on the phone?
If they are concerned about competition, then where are the complaints that say that phone makers can't catch a break due to the rules that Google puts out there for re-distributing Android with potential modifications by phone makers? They don't want to include the "base apps" that come with Android, they can always make their own operating system.
Of course, if what you want is to eliminate tracking from phones in the EU, you could pass laws that, y'know, eliminate tracking. I imagine Google - and others - could still make bundles without tracking individual users, but if they can make more with tracking, they're gonna do it.
Meanwhile, nobody seemed to care about Google search and gmail being included in Android phones till they got too popular - and presumably, competitors started bribing politicians. That doesn't mean the behavior shouldn't be stopped, but imposing a huge fine over past behavior that only crossed the line at some undetermined point in the past seems draconian. If you can't act soon enough to prevent the harm, you can't (well, I guess maybe you can), punish past legal behavior for retroactively becoming illegal. That's not quite fair.
When they went after Microsoft, they first got a consent decree ("we won't do that any more") and then fined them for violating it. Was such an agreement made - and violated - in Google's case with Android?
And in Microsoft's case, the remedy was to force them to allow a choice of browsers. Android already does that. And a choice of launchers (with or without the Google search widget). What's missing here? Only the option for OEM's to accept payments from Microsoft to build phones with Bing instead of Google?
Posted from my Android phone. Oh, I can change this? There, that's better...
For a while I actually had the Bing search thing on my phone (and yeah, searches in that big search box on the home screen went via Bing) because various flaws in Google had made me temporarily want to try alternatives. It worked, and unlike, say, Microsoft's "It's done when Lotus won't run" philosophy, it was fully integrated and there were no obvious downsides of running a non-Google system beyond, well, the fact Bing sucks.
There is absolutely nothing stopping someone from downloading and using a rival search service on an Android phone that has the Play Store.
Also worth noting is that this applies only to search. Google has a range of other products, and has never placed any restrictions on rival products being bundled on phones. Google is even happy for rivals to the Play Store to be pre-installed - look at Amazon's Prime Exclusive phones for example.
Everything seem to be more than a little overblown by the EU here.
You are not alone. This is not normal. None of this is normal.
Not quite. There was militant extremist Islam hundreds of years before the United States even existed. Read some history. Our first conflict with Islam was barely over two hundred years ago.
Islam spreads by the sword or, in the case of Europe now, by coming in and out-reproducing the native population. If things continue the way they're going, Europe WILL be Muslim-dominated in a few short decades. No, you can't come over here to escape it. We don't want you.
That's the sad part... The SJW crowd thinks they are "better", but I've come to the conclusion that the left is actually the racist group... and far more racist than anyone on the right that I have any sort of contact with.
The left has decided to break everyone down by race, gender, sexual orientation, and a host of other things. Everyone (to them) is just a member of some "oppressed" group. Well, unless you are white in which case you are pure, distilled, evil....
In fact, the left has taken it upon themselves to be outraged ON BEHALF of minorities... Talk about being fucking patronizing......
I know people who, for example, don't like blacks... (Because they are fucking racist...) But I've never seen one of those mouth-breathers stand up and pretend to speak on behalf of blacks.. Yet, I see this coming from the left ALL THE FUCKING TIME.
We had such an incident in my area not so long ago, where a bunch of snowflake liberals ran around acting all outraged over a school mascot that is done in the likeness of a certain Native American (Indian) chief.
They were just freaking out about it... However, when the local news went out and did a bunch of interviews, they couldn't find anyone, of that tribe, who was offended. Most said they were quite happy that the mascot depicted the Chief in a positive, strong, and dignified way. Not all were "pro mascot", but the worst opposition they could find was.. indifference.. i.e. some members of the tribe basically said they didn't give a crap one way or the other, but they weren't offended...
You'd think the outrage would have died down at that point.. I mean if the members of the tribe aren't upset....
But NO! The SJW's know better.. A couple of them, who were suspected of being the leaders of the protesters, were recorded on hidden camera saying (and I'm paraphrasing because I don't remember the exact wording) that the tribe had been oppressed for so long that they couldn't be trusted to know what was offensive to them.
They basically accused this tribe (which has a HUGE casino and is very prosperous) of having Stockholm Syndrome. This tribe has had a casino for about 30 years.. i.e. they are all upper middle class at this point, and the members that make up the bulk of the tribe have never been oppressed. Nobody in that tribe that is 35 or less has ever eaten government cheese or been dependent on the white man for anything.. i.e. they don't need you holier-than-thou cunts speaking for them. They don't have Stockholm Syndrome.... But, you see, to an SJW it's just a bunch of dumb Indians who need protection, from whites, by whites who know better and are more virtuous...
The level of hubris and irony is beyond......
So my dear SJW, please continue to be outraged on behalf of groups you have no connection with. Please continue to speak on their behalf and continue your own self-hatred of your own race. If you signal hard enough somebody, somewhere, might think you are a good person... Well, until they realize that you are just as racist as those on the extreme right...
At least the racists on the right just declare their racism.. They don't hide it like the left... They don't pretend to care about minorities and at the same time think said minorities are too stupid, weak, or unsophisticated to handle their own lives.