In practice, the company is being accused of adopting monopolistic position
This Wednesday (20) started well for Google. Good bad: after an investigation that lasted about a year, the European Commission decided to formally accuse the company of violating antitrust laws. This means that over the coming months, Google will have toperfect in its defense. Only way to escape heavy fines and even changes in their business.
The situation is quite complicated. The European Commission concluded that “Google has implemented strategies in relation to mobile devices to preserve and strengthen its dominance in relation to general research services on the internet.” As? In the view of the organization, making the search engine Google to be installed by default on Android devices and thus hindering the advancement of competing services on the platform.
The agency also understands that this apparent dominant position can be hurting users, since the absence of rival services inhibits competition. When this occurs, there is a disincentive to innovation. The effect of this is that the user ends up leaving to access resources in an inverse situation could be more sophisticated or advantageous.
Just like Google would come to this extreme? This is what the European Commission tried to find out with the investigation. The organization identifies three key practices:
- require that manufacturers pre-install Google’s search tool and the Chrome browser, and set the default search engine on mobile devices as a condition for granting access licenses to certain unique applications of the company;
- prevent manufacturers from selling mobile devices running competing operating systems that are based on the open source Android platform;
- give financial incentives to manufacturers and mobile operators with the condition preinstall exclusively the Google search application on their devices.
Note that in the first practice, the Commission cites Chrome. There is another point of concern. The organization believes that, with this approach, Google tries to impose its search engine on mobile devices, but enjoy the same practices also hinder access to the Chrome browser competitors. It is an aspect that resembles the antitrust case that Microsoft faced with Internet Explorer.
As expected, Google tried to defend. And fast: in a statement released today, the company said some arguments that it had already released throughout the research process.
In one, Google explains that the agreements with manufacturers are voluntary and any company can implement Android without installing its ecosystem. The company cites Amazon as a company that did this, a clear reference to the (deceased?) Kindle Fire line.
Another argument: Manufacturers are free to pre-install on their devices applications that do not belong to Google. The company also notes that today many devices ship with apps from vendors such as Microsoft, Facebook and Amazon.
Another: Google says that Android provides for free and to offset the costs of development, maintenance and improvements on the platform, as well as the expenses necessary to defend cases involving patents, includes applications tied to their services in the ecosystem. Users, however, would not be constrained to them.
Also according to the company, the popularity of apps like Instagram, Snapchat and Angry Birds show how easy it is for the user to download and use other tools.
These and other arguments seem legitimate, but it is up to the European Commission to accept them or refute them, obviously. Google and Alphabet (recalling the “parent company” Google) have received notification of the charges and have to respond to all requests for information and clarification from the European Commission. This is because, from now on, the investigation process will intensify.
The whole process can take months or even years to complete. If the European Commission finds that Google has abused its dominant position, the company may need to take measures to stimulate competition, and give the user the option to choose the default search service the first time that your mobile device is turned on or not distribute Chrome pre-installed mode.
Fines are also a major concern for the company, after all, the European Commission usually very strict with them. One possibility is that the entity covers a fine corresponding to 10% of the company’s revenue in its last fiscal year. In Google’s case, this value in the most recent closure was US $ 74.5 billion. If the fine were applied now, the company would have to pay no less than $ 7.45 billion so.