EU slaps Google with record $5 billion anti-trust fine

[Commissar SFLUFAN]

The European Commission says Google has abused its Android market dominance in three key areas. Google has been bundling its search engine and Chrome apps into the operating system. Google has also allegedly blocked phone makers from creating devices that run forked versions of Android, and it “made payments to certain large manufacturers and mobile network operators” to exclusively bundle the Google search app on handsets.

[Greatoneshere]

6 minutes ago, SFLUFAN said:

The European Commission says Google has abused its Android market dominance in three key areas. Google has been bundling its search engine and Chrome apps into the operating system. Google has also allegedly blocked phone makers from creating devices that run forked versions of Android, and it “made payments to certain large manufacturers and mobile network operators” to exclusively bundle the Google search app on handsets.

 

It's dumb for Google to do it anyway - are they really worried people won't immediately download their apps first anyway? C'mon now. This is a good thing by the Commission. 

[TwinIon]

This is a stupid decision. Bundling chrome and google search into android is really not that big of a deal as long as you allow preinstalled alternatives. Various device makers and carriers already pre-load alternatives and set them as default apps, Google isn't directly preventing that. I think it's naive to say that at this point that an OS and a web browser are entirely distinct and if Google is building an OS, it seems perfectly fair for them to also require their browser. At least they, unlike their competition, allow different rendering engines and allow OEMs, carriers, and users to set their own defaults.

 

I think there's something of an argument to be made when it comes to Google buying exclusivity, but it still seems odd to tell Google they can't do that, but allow other companies to do it.

 

The issue of Android forking is something I'm not entirely clear on. Google allows forks, but doesn't allow them to use the Play Store. If that's the whole issue, it seems fair to me, though I'm open to counter arguments. I realize that access to the store is the primary reason that Android isn't forked, but I think it's kind of extraordinary that Android can be forked under any circumstances. This decision, assuming it stands, could very well be the end of AOSP, and will certainly accelerate the move of crucial components from ASOP to Google Play Services.

 

Overall it just seems odd to me that Google is now subject to the largest antitrust fine in history for allowing their platform to be open, but not open enough. If you're Apple and you don't allow anything. I realize it's the difference between how you're treated with 75% market share vs 25%, but still.

[Greatoneshere]

5 minutes ago, TwinIon said:

This is a stupid decision. Bundling chrome and google search into android is really not that big of a deal as long as you allow preinstalled alternatives. Various device makers and carriers already pre-load alternatives and set them as default apps, Google isn't directly preventing that. I think it's naive to say that at this point that an OS and a web browser are entirely distinct and if Google is building an OS, it seems perfectly fair for them to also require their browser. At least they, unlike their competition, allow different rendering engines and allow OEMs, carriers, and users to set their own defaults.

 

I think there's something of an argument to be made when it comes to Google buying exclusivity, but it still seems odd to tell Google they can't do that, but allow other companies to do it.

 

The issue of Android forking is something I'm not entirely clear on. Google allows forks, but doesn't allow them to use the Play Store. If that's the whole issue, it seems fair to me, though I'm open to counter arguments. I realize that access to the store is the primary reason that Android isn't forked, but I think it's kind of extraordinary that Android can be forked under any circumstances. This decision, assuming it stands, could very well be the end of AOSP, and will certainly accelerate the move of crucial components from ASOP to Google Play Services.

 

Overall it just seems odd to me that Google is now subject to the largest antitrust fine in history for allowing their platform to be open, but not open enough. If you're Apple and you don't allow anything. I realize it's the difference between how you're treated with 75% market share vs 25%, but still.

 

Is your issue that they are going after only Google or that they are doing it at all? Because I'm all for going after all of them if possible.

 

I have no problem with pre-loads, but bullying it into existence is not something I'm a fan of, which is how this read to me. And anything that limits monopolies and trusts, even arguably benign blocks such as this one (is it really bad they pre-load their stuff? no) because they are already running loose and drunk on power. 

[Rodimus]

This is Windows 98 all over again.

[TwinIon]

33 minutes ago, Greatoneshere said:

Is your issue that they are going after only Google or that they are doing it at all? Because I'm all for going after all of them if possible.

 

I have no problem with pre-loads, but bullying it into existence is not something I'm a fan of, which is how this read to me. And anything that limits monopolies and trusts, even arguably benign blocks such as this one (is it really bad they pre-load their stuff? no) because they are already running loose and drunk on power. 

I don't think that they should be doing this at all, and 2 of the 3 vectors they chose to go after seem entirely benign and likely to end up limiting consumer choice.

 

Pre-loading a completely essential part of an OS seems pretty standard to me. There might not be a more core function of an OS today than the ability to browse the web, and Google is far more open in this regard than Microsoft was back in the day or Apple is today with iOS. They allow default installs for competing products and they allow defaults to be changed.

 

 

They're even more open when it comes to forking. The only reason that it's possible to fork Android at all is because it's (at least partially) open source. This ruling seems like a punishment for that decision. If Android had been closed source (as all it's competitors have been and are), no one would be complaining that Google's restrictions with forks are problematic.

 

Like I said before, I think there is something to Google buying exclusivity arrangements. That is an abuse of market power to the detriment of their competitors and prevents real competition taking place. Of course, the only reason that such exclusivity arrangements exist is because other companies were trying to do the same thing. 

 

[Jason]

1 hour ago, Greatoneshere said:

 

It's dumb for Google to do it anyway - are they really worried people won't immediately download their apps first anyway? C'mon now. This is a good thing by the Commission. 

 

But Google does allow forks. What they don't allow is bundling their core packages suite (Play Store, Gmail, etc) with forks. This is the situation with the Amazon Fire tablet, for example.

 

1 hour ago, TwinIon said:

Google allows forks, but doesn't allow them to use the Play Store.

 

You can sideload the Play Store to a Fire tablet and it'll work fine.

[TwinIon]

2 minutes ago, Jason said:

You can sideload the Play Store to a Fire tablet and it'll work fine.

Yes, but you can't sell a forked device with the Play Store installed, which automatically limits it's appeal. Also, the lack of bundled Google Play Services means that either the maker of the fork or individual developers need to implement their own version of those services (social, location, etc.). Again, if the fork is sufficiently compatible (like the Fire devices), you can sideload GPS and everything should work, but the point is that it's an enormous incentive to use Google's version of Android rather than forking it. I think that's fine, the EU apparently disagrees.

[Reputator]

Stupid. Google should seek retaliatory measures.

[Greatoneshere]

52 minutes ago, TwinIon said:

Like I said before, I think there is something to Google buying exclusivity arrangements. That is an abuse of market power to the detriment of their competitors and prevents real competition taking place. Of course, the only reason that such exclusivity arrangements exist is because other companies were trying to do the same thing. 

 

I think we're in agreement. I like Google, and I'm a huge proponent of open source and having options. What I don't like is the bullying and exclusivity arrangements part is all. You seem to agree there. If the Commissions lack of broadness or inability to penalize all offending companies I would agree with you but to say not going after Google because the Commission didn't go after others, that I'm not so sure about. (if that's what you're saying). 

[TwinIon]

15 minutes ago, Greatoneshere said:

I think we're in agreement. I like Google, and I'm a huge proponent of open source and having options. What I don't like is the bullying and exclusivity arrangements part is all. You seem to agree there. If the Commissions lack of broadness or inability to penalize all offending companies I would agree with you but to say not going after Google because the Commission didn't go after others, that I'm not so sure about. (if that's what you're saying). 

I think it's fine to go after Google for exclusivity payments, even if they don't go after everyone. I get the impression that (if this ruling stands) Microsoft could sign an agreement with Samsung or Orange to make Bing the default search engine on some or all of their Android phones. I'd  rather the EU just have a law that outlines when something like that is allowed, market leader or not. 

[Greatoneshere]

5 minutes ago, TwinIon said:

I think it's fine to go after Google for exclusivity payments, even if they don't go after everyone. I get the impression that (if this ruling stands) Microsoft could sign an agreement with Samsung or Orange to make Bing the default search engine on some or all of their Android phones. I'd  rather the EU just have a law that outlines when something like that is allowed, market leader or not. 

 

That would be my preference as well, but I'll take whatever I can get in this post-Citizens United, pro-Citizens United world. 

[TwinIon]

Steven Sinofsky (former head of Windows at MS) has an interesting take on all this in this thread. He's admittedly a bit biased, but has a unique perspective on the case.

 

 

Something in particular that he brought up is that the EU defined the markets that Google dominates as "general internet search services, licensable smart mobile operating systems and app stores for the Android mobile operating system." 'General internet search services' seems fair enough, but "licensable smart mobile operating systems and app stores for the Android mobile operating system" is crazy because it automatically defines the market as one that Google created themselves and necessarily leaves out their actual competitors. With ~75% of the EU market you can make a case that Android is too dominant, but when you define the market basically as "Android phones and Android app stores" then it's pretty hard to come to any conclusion that they're not a monopoly.

[TwinIon]

Another interest part of this story is how it might end up shaping the future of Google's mobile efforts. Bloomberg has a new story out about project Fuchsia, an experimental OS inside Google that could end up replacing Android and Chrome OS. For the time being Fuchsia is partly open source, but I have to imagine that if Google does decide to move away from Android that the issues the EU brings up in court will affect Google's decision making. If Google is forced to allow forks and app stores they don't want, and if they're forced to segregate the browser and search from the OS, Fuchsia could end up making those things impossible.

 

There's a good chance Fuchsia never really sees the light of day as a consumer product, so I'm really not trying to be alarmist or anything when it comes to this ruling. Still, it's worth considering how these kinds of decisions can end up shaping the future of innovation.

[TwinIon]

Google has announced how they're going to comply with the EU's ruling (it's up to Google to figure out how to fix things, since the EU doesn't specify a course of action).

 

They're going to allow device makers to make forked devices and sell licenced devices at the same time. This is likely not relevant, but it's also unambiguously good. It allows device makers the freedom to experiment without risking their ability to make devices that will actually sell.

 

They're going to split up the licencing of Google Search, Chrome, and the Play store. I still don't think this is a big deal, since device makers can still put their own web browsers or search defaults in devices, but whatever.

 

The big deal here is that they're also going to start charging for android licences in Europe. Google says that the bundling of those services is what allows them to pay for the development of android, so if the EU is going to take that away from them, someone has to pay. I imagine that device makers are not going to be happy that their free OS is now a paid OS.