Antitrust law: EU court confirms billions in fine against Google

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Photo: David Paul Morris/Bloomberg/Getty Images

On Wednesday, the Court of Justice of the European Union ruled on Google being fined billions by the EU Commission.

It largely upheld the fine imposed by the EU back in 2018, but reduced the fine imposed on the US internet giant from €4.34 billion to €4.125 billion.

(Case T-604/18).

It is one of the largest fines ever imposed on US technology companies.

Google had legally defended itself against the penalty.

Market power of Android operating system

The proceedings are about the Android smartphone operating system developed by Google and how Google is said to have gained advantages over the competition through its market power.

Android, which is used by manufacturers such as Samsung, Oppo and Xiaomi, is the most used smartphone system in the world with a market share of around 80 percent.

Other companies can use Android for their devices for free.

However, if you want to modify the operating system, there are restrictions if you bring Google services such as GMail or Google Maps to the devices.

The Commission accuses Google of having unfairly secured the market position of its various online services, including Playstore and Google Drive, against other service providers.

Among other things, the Commission was bothered by the fact that manufacturers of Android smartphones who want to integrate Google services always had to install a complete package of eleven Google apps on the devices.

For example, Google's Chrome browser and Google search always come onto the devices, even if a manufacturer only wants to install the Play Store app platform, for example.

EU Competition Commissioner Margrethe Vestager emphasized in 2018 that the pre-installation of Google as the default search engine ensures that consumers use it instead of downloading a competitor's application.

(Read more about the background to the EU allegations here.)

Google has already responded

Google was forced to change its business model in 2018, despite legal opposition.

Since then, the company has allowed other manufacturers to integrate individual services without Chrome and web search.

Google criticizes the EU's fine because bundling several apps is necessary.

Otherwise, users would not be able to use linked Google services properly.

Google can still appeal Wednesday's verdict to the European Court of Justice (ECJ).

Such procedures often take several years.

More allegations against Google

The Brussels authorities also criticized the so-called "anti-fragmentation agreement", according to which providers of devices with Google services could not also sell smartphones with modified Android versions at the same time.

Vestager pointed out in 2018 that a few years ago Amazon wanted to offer its modified Android system FireOS to other manufacturers.

They were interested, but couldn't use FireOS because they couldn't offer any more devices with Google services afterwards.

Google also lifted this restriction in 2018.

The Commission's third allegation revolved around the fact that Google only shares the proceeds from advertising in the search app with device manufacturers if it was exclusively installed on the phones and tablets.

Since 2018, Google has been offering new license agreements for non-exclusive use of the app.

The judgment is part of a series of legal disputes between the EU Commission responsible for competition in the European Union and the American company (Case T-604/18).

Since 2017, the Brussels authorities have imposed several fines on Google, some of historic proportions, most recently last year.

Several lawsuits by Google against Commission decisions are still pending both before the EU Court and the ECJ.

South Korea also imposed fines

South Korea announced on Wednesday that it had imposed a fine of around 50 million euros on Google's parent company Alphabet.

The country's data protection commission accuses the group of violating privacy guidelines.

According to the South Korean authorities, Alphabet is said to have not sufficiently informed its users when and how data on behavior is collected and analyzed.

Google has not yet commented on the process.

hpp/dpa