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Competition Commission of India fines Google Rs 1,338 crore for unfair practices

Google should allow developers of "app stores" to distribute them on the Google Play Store, CCI noted.

Google Office

The Competition Commission of India fined Google Rs. 1338 crore for anti-competitive practices related to Android mobile devices on Thursday. The watchdog in its press release said the tech giant has abused its dominant position by forcefully entering into “one-sided agreements” with Android mobile makers to ensure the dominance of its apps and search engine, which has denied rivals the chance to innovate and compete on their merits.

CCI said Google created an ecosystem wherein Android smartphone makers were mandated to pre-install apps like YouTube, Gmail, etc., and maintain its prominent positioning with no option of uninstalling the same. Google made its search engine the primary search engine for all queries by default during the initial device setup. By following these practices, Google denied market access to competing apps and continued supply of consumer data for its apps to garner advertising revenue, while blocking others, CCI noted.

The fair trade regulator has further directed Google to cease and desist from unfair business practices. It said Google should allow developers of “app stores” to distribute them on the Google Play Store instead of compelling users to download such apps through side-loading, among other measures.

“Markets should be allowed to compete on merits and the onus is on the dominant players (in the present case, Google) that its conduct does not impinge this competition on merits,” the press release said.

Google’s Android operating system powers 97% of India’s 600 million smartphones, making it the tech giant’s largest market in terms of users, according to research firm Counterpoint. CCI began the probe against the tech giant in 2019 following complaints by consumers of Android-based smartphones in the country. CCI was investigating whether Google had assumed a dominant position in five markets: licensable OS for smartphones, app store, web search services, non-OS specific mobile web browsers, and online video hosting platform in India. It found Google dominant in all of those relevant markets.

“By virtue of the agreements… Google ensured that users continue to use its search services on mobile devices, which facilitated uninterrupted growth of advertisement revenue for Google. It also helped Google to further invest and improve its services to the exclusion of others. Thus, the underlying objective of Google in imposing various restrictions… was to protect and strengthen its dominant position in general search services and thus, its revenues via search advertisements,” CCI said.

Back in 2016, Google faced similar charges in European Union with a record fine of $5 billion fine for using its Android operating system to gain an unfair advantage in the market.

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