A Blog by Jonathan Low

 

Apr 11, 2016

Anti-Trust Pressure on Google's Android Continues To Build

These challenges strike at the heart of  quintessential contemporary tech strategy: build an ecosystem from which it is virtually impossible to exit and then dominate the users' lives, reaping excess profits in the bargain. If Google falls, who, among the tech colossi, is safe? JL

Chris O'Brien reports in Venture Beat:

All these investigations revolve around the same basic question: Is Google being too aggressive in requiring handset makers that use Android to bundle its apps on their phones?
Sometime today Alphabet’s Google may learn just how large of a fine it is facing for alleged Android antitrust abuses in Russia.
But the antitrust ruling it lost last month in Russia is just one of a series of setbacks for the world’s largest mobile operating system, which finds itself under a growing amount of regulatory scrutiny around the world.
In March, a Russian appeals court denied Google’s appeal and let stand a ruling that Android had broken the nation’s antitrust rules by requiring pre-installation of some of Google’s apps.
The original complaint had been brought by Russian Internet giant Yandex. Russian officials had said that the fine could be as high as eight percent of the revenue Google derives from people using its services on Android in Russia. However, it’s still unclear what that revenue number is.
The European Union announced last year that it was investigating similar issues with regard to Android. Last week, EU Commissioner Margrethe Vestager said its inquiry was pressing ahead and hinted that her agency could be filing formal charges soon, according to the Wall Street Journal.
Meanwhile, back on the home front, Android continues to face the possibility that the Federal Trade Commission will open a formal investigation into the OS. Last September, Bloomberg reported that the agency has begun the initial stages of a probe, though no formal inquiry or charges have been announced yet.
All these investigations revolve around the same basic question: Is Google being too aggressive in requiring handset makers that use Android to bundle its apps on their phones? Many rivals have complained about the practice.
Google might walk a fine line here, but the practice also seems an essential underpinning of the strategy behind offering a free mobile phone operating service in the first place. Losing such a case over the long-term could be about more than just whatever fines Google may or may not have to pay.
If Google was at some point forced to strip all of its own apps and services from Android, one could wonder to what degree the company would want to continue to focus on its development.
Anything that caused Google to back away from Android, even a bit, could have giant consequences for a huge ecosystem of handset makers, app developers, and new consumers who are able to buy their first smartphones thanks the increasingly low cost of handsets.

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