Google is rigging the global app market with Android, EU alleges

The Android operating system is designed to feature Google's search engine, maps, Gmail, YouTube service and other products that give the company more opportunities to sell digital ads.

By Associated Press

April 20, 2016 12:05 PM PT

reporting from brussels — The European Union is broadening its battle with Google, alleging that the technology giant rigs the global market for mobile apps by making its Android operating system give preferential treatment to its own products.

EU Antitrust Commissioner Margrethe Vestager said Wednesday that “Google’s behavior denies consumers a wider choice of mobile apps and services and stands in the way of innovation.”

The Android operating system is designed to feature Google’s search engine, maps, Gmail, YouTube video service and other products that give the company more opportunities to sell digital ads. Device makers don’t have to use Android as Google sets it up, but European regulators are looking into complaints that the company penalizes those that deviate from Google’s favored design.

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Vestager kicked off what is likely to be a protracted legal battle with a so-called Statement of Objections accusing Google it uses its high market share to force its apps on customers. Vestager said Wednesday’s move in no way prejudges the outcome of its investigation.

“It is an interim step and not the end of the road,” she said.

The 28-nation EU also has other investigations against Google, with the biggest centering on its search services. Vestager said there were antitrust concerns over a range of the multinational’s operations.

Vestager noted that Google had “shares of over 90 percent in Europe in the markets for general internet search services, licensable smart mobile operating systems and app stores for the Android operating system.”

Her view is “that Google has abused its dominant positions in these three markets.”

As an indication of how big the latest issue is, 4 out of every 5 smartphones and tablets globally, and in the European market, use Android. Google has stormed the market since it began eight years ago to give away its Android software for free to manufacturers to counter the runaway success of Apple’s iPhone.

Now, Android powers billions of mobile devices largely because it doesn’t cost phone and tablet makers anything to use the software.

“Dominant companies have a responsibility not to abuse their position,” Vestager said. “Google has abused its dominant position.”

Google strongly denied the charges, and its general council, Kent Walker, said the company was looking “forward to working with the European Commission to demonstrate that Android is good for competition and good for consumers.”

While Vestager complains about “restrictive licensing practices,” Walker highlighted that Google’s “partner agreements are entirely voluntary” allowing companies to use and modify Android at will.

The EU charges come a day after Canadian competition authorities cleared Google of some of the same issues that the EU is objecting to, said the CCIA global group of computer, communications and Internet companies.

Google, based in Mountain View, Calif., has 12 weeks to respond to Vestager’s objections.

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