How much Google has been fined
CCI imposed a penalty of Rs 1,337.76 crore on Google for abusing its dominant position in multiple markets in the android mobile device ecosystem. The company was fined EUR 4.34 billion (approximately Rs 35,541 crore) by the EU in 2018 for the same reason. However, the fine was later cut to EUR 4.125 billion (approximately Rs 33,296 crore) by the the second-highest European court.
Essentially, the EU has fined Google a total of EUR 8.25 billion (approximately Rs 66,600 crore) for antitrust violations after three investigations which spanned over a decade.
Why CCI has fined Google
The Indian watchdog started investigating Google three and a half years ago after a complaint, which said that Google used its dominant position to make it mandatory that OEMs pre-install its entire Google Mobile Suite – which include Search, Chrome, YouTube, Google Play store, Maps, and Photos, among others – on their phones and place them prominently.
Android operating system powers 97% of 600 million smartphones in India, making it Google’s largest market by users, as per Counterpoint Research.
The CCI found that this mandate “amounts to imposition of unfair conditions on the device manufacturers” and thus was in “contravention of the provisions of Section 4(2)(a)(i) of the [Competition] Act, [2002].”
As per the provisions of the act, “there shall be an abuse of dominant position under sub-section if an enterprise directly or indirectly, imposes unfair or discriminatory condition in purchase or sale of goods or services.”
During the course of inquiry, Google argued about the competitive constraints being faced from Apple. However, CCI said that Apple’s business is “primarily based on a vertically integrated smart device ecosystem which focuses on sale of high-end smart devices with state of the art software components.” Whereas Google’s business “is driven by the ultimate intent of increasing users on its platforms so that they interact with its revenue earning service.”
How CCI wants Google to change
Apart from imposing monetary penalty, the commission has issued cease and desist orders against Google from indulging in the found anti-competitive practices.
It also says that OEMs should not be mandated to choose Google’s proprietary applications and services to be pre-installed and placed as Google says. It is also told to not restrict uninstalling of its pre-installed apps by the users.
The company is also told not to offer any monetary/ other incentives to OEMs for ensuring exclusivity for its search services. “The company shall not deny access to its Play Services APIs to disadvantage OEMs, app developers and its existing or potential competitors,” the CCI order read. In the release, CCI has directed Google to modify its conduct within a defined timeline.
Google’s response on CCI fine
A Google spokesperson said that the decision opens serious security risks for Indians who trust Android’s security features. “Android has created more choice for everyone, and supports thousands of successful businesses in India and around the world. The CCI’s decision is a major setback for Indian consumers and businesses, opening serious security risks for Indians who trust Android’s security features, and raising the cost of mobile devices for Indians. We will review the decision to evaluate next steps,” the spokesperson said.
