Google appeals record $5 billion EU antitrust Android fine

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October 9, 2018 10:18 pm Published by

Earlier today Google filed an appeal of the European Commission’s (EC’s) record €4.3 billion (roughly $5 billion) antitrust fine. The fine was imposed in July because of Google Play app pre-install requirements.

Claim is that Google tying apps to Android. The EC saw the practice of requiring handset makers to pre-install certain Google apps as “an abuse of market position” (akin to tying). By contrast, Google argued at the time in a blog post that the practice is beneficial to the ecosystem and enables the company to offer the Android OS for free. Google was given 90 days to change how it did business with phone makers or face additional fines.

Google said, as soon as the fine was imposed, that it would appeal the decision.

More consumer choice at lower cost. In the appeal, among other things, Google will argue that its practices offer consumers more choice at lower cost. The EC has alleged that Google’s practices harm competitors in multiple ways and give Google’s own apps an unfair advantage.

Procedurally, the case will go to Europe’s second highest court. That means there could be another appeal to the highest court, the Court of Justice of the European Union. Ultimately it could take years to finally resolve the matter.

The market initially reacted negatively to the fine in July. But when Google announced very strong results about five days later, investors just shrugged the EC’s largest-ever antitrust penalty.

Why should marketers care. It remains to be seen whether Google significantly changes its Android rules in Europe during the appeal. The EC is seeking to compel such changes, which could open the door for new “default” apps on European handsets in search, maps, video and so on.

That would matter to developers, if it comes to pass. It could matter to marketers if, for example, new apps gain widespread consumer adoption (e.g., maps, search). But this is quite speculative. Users would still be free to download Google apps and continue using them as they are today; there would just be an additional step.