Google’s vice president of platforms, Hiroshi Lockheimer wrote, “Since the pre-installation of Google Search and Chrome together with our other apps helped us fund the development and free distribution of Android, we will introduce a new paid licensing agreement for smartphones and tablets shipped into the EEA“Google has tried to appeal to the European Commissions largest anti-trust fine by claiming that Android had “created more choice, not less.” However, if Google fails to comply to the European Commission’s terms within 90 days, it would be liable to be fined for up to 5 percent of the average daily worldwide revenue of Alphabet Inc., Google’s parent company. Stay tuned for more updates!
Google Dished by a $5 Billion Fine
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Having monopolized the Android mobile operating system, it was no hard feet for Google to strike a deal to only allow it’s Play store to be used if the smartphone manufacturers pre-installed both Chrome and Search, which is in direct violation of competition rules.
It prevented smartphone manufacturers from modifying versions of Android, in case that would make them incompatible with Search. The largest fine issued to Google was by the European Commission last year when they fined Google a $3 billion for enforcing its shopping service on smartphone makers over competitors, which the European Commission has now surpassed in July 2018 by fining Google $5 billion for “bundling” it’s apps together for Androids, which is unarguably the most popular operating system in the smartphone world.
In response to this startling fine, Google has decided to untie the 11 apps that it previously bundled together to be pre-installed on Android smartphones. Google has now decided to charge manufacturers licensing fee for apps that were previously pre-installed and free. These include Gmail, YouTube, Chrome, and Maps in Europe.
From now on if smartphone manufacturers wish to have Google’s apps pre-installed, they would have to pay an unspecified amount as the fee for the license. Although all Google apps on Android smartphones were free, it was able to gain revenue by collecting data and targeting advertisements.
Google will now let smartphone manufacturers develop “forked” tablets and smartphones only for the European Economic Area (EEA), 28 countries to be exact, where these changes will be executed by October 29th.
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