The European Union antitrust chief, who has already charged Google with favoring its own shopping service in internet searches, announced that she was now examining its deals with mobile phone manufacturers and operators.
The comments by European Competition Commissioner Margrethe Vestager follow a year-long investigation into Android, the world’s most popular operating system for smartphones, triggered by two complaints.
A decision on the shopping service could come this year. Like the Android case, it could lead to a fine of up to $7.4 billion or 10 percent of Google’s 2015 revenue, and force it to change its business practices.
Vestager said big companies should not try to protect themselves by holding back innovation.
“That’s why we’re looking closely at Google’s contracts with phone makers and operators which use the Android operating system,” she said at a conference organized by the Dutch competition authority.
“Our concern is that, by requiring phone makers and operators to pre-load a set of Google apps, rather than letting them decide for themselves which apps to load, Google might have cut off one of the main ways that new apps can reach customers.”
The Commission said last year that it was also investigating whether Google had prevented smartphone and tablet manufacturers from developing and marketing modified and potentially competing versions of Android.
Another area of concern was whether Google had illegally hindered the development and market access of rival applications and services by bundling some of its applications and services distributed on Android devices with other Google products.
The FTC defended its decision to let Google carry on with its anti-trust-like antics, while other regulations in civilized nations are planning to put the boot in.
The US Federal Trade Commission reached a settlement with Google which really did little to stop the company using its dominance to push down search results from its competitors. The move attracted considerable criticism because it followed a letter from US senators to go easy on the search engine because it was good for US jobs. We guess they mean the jobs of US senators who Google paid campaign contributions.
Google promised to change the ways it presents some search results and runs search advertising, but was exonerated of the results bias claims. Rivals including Yelp and Microsoft claimed that Google had favored its own product results over those of its competitors and called for the anti-trust case. What makes the case look more suspect is that the EU is less frightened of actually fining Google or forcing it to behave. Indeed indications from Brussels are that it has not only agreed with the rival’s complaints but will do something about it if Google does not pull finger.
But FTC chairman Jon Leibowitz told Talking Points Memo that the agency’s decision was legally sound and would be beneficial to competition and consumers. Under facts we found, all five of us, from liberal Democrat to conservative Republican, agreed that the evidence militated against an anti-trust case,” Leibowitz told TPM.
The fact that we managed to have both Google and Google’s rivals unhappy, in an odd way that’s maybe unique to Washington, that puts us in the right place substantively, he claimed. When asked if Google’s $25 million lobbying budget for the duration FTC’s investigation helped, he said that lobbying makes the companies feel good and lobbyists feel good.
“At the end of the day, whether you want to say lobbying had any influence, or cancelled itself out because there was lobbying on both sides, if you’re going to do what lobbyists want you to do in a regulatory agency, you’re not doing your job.”
When the FTC announced the settlement with Google on January 3, it was portrayed as a victory for Google. Leibowitz said that reporters think of this in some ways as a horse race, when it is about doing the right thing. So the question is why is doing the “right thing” possible in the EU and not in the US?
The majority of top decision-makers at the Federal Trade Commission believe that an antitrust case should be lodged against Google Inc, meaning the search giant could soon be headed into tough negotiations, three people familiar with the matter said.
Four of the FTC commissioners have become convinced after more than a year of investigation that Google illegally used its dominance of the search market to hurt its rivals, while one commissioner is skeptical, the sources said.
All three declined to be named to protect working relationships.
Two of the sources said a decision on how to proceed could come in late November or early December.
A long list of companies has been complaining to the FTC, arguing that the agency should crack down on Google.
Companies rarely talk publicly about their dealings with the FTC, but consumer reviews website Yelp and comparison shopping website Nextag have both complained about Google during open hearings in Congress.
Google rivals specializing in travel, shopping and entertainment have accused Google, the world’s No. 1 search engine, of unfairly giving their web sites low quality rankings in search results to steer Internet users away from their websites and toward Google products that provide similar services.
Computer users are overwhelmingly more likely to click on the top results in any search. The low ranking often forces companies to buy more ads on Google to improve their visibility, one source said.
Google has repeatedly denied any wrongdoing.
Asked about any discussions with the FTC, Google spokeswoman Niki Fenwick said: “We are happy to answer any questions that regulators have about our business.” The FTC declined to comment.
A Paris Court earlier this week ordered Google France and its parent company Google to pay plaintiff Bottin Cartographes 500,000 euros (about $660,000) for providing its free mapping services to companies across the country. The court also required Google to pay a 15,000 euro fine for its practice.
“We proved the illegality of (Google’s) strategy to remove its competitors,” Jean-David Scemmama, attorney for Bottin Cartographes, a company that provides mapping services to the enterprise, told the AFP in an interview earlier this week. “The court recognized the unfair and abusive character of the methods used and allocated Bottin Cartographes all it claimed. This is the first time Google has been convicted for its Google Maps application.”
According to Scemmama, Bottin has been arguing its case against Google for two years, claiming the search giant was engaging in anticompetitive practices by using its free service to take control over the online-mapping industry.
In a statement to the AFP, Google said that it will appeal the court’s decision, adding that Google Maps is still facing competition in that market.
Late last year, Google Maps also came under fire in the U.S., after British Telecom filed a lawsuit against the search giant in a Delaware District Court, claiming the mapping service violates patents it holds related to navigation information.
AT&T and T-Mobile had moved for dismissal of the lawsuits arguing that the complaints by Sprint and C Spire, formerly Cellular South, failed to adequately substantiate that the merger would cause them “antitrust injury”.
The decision by District Judge Ellen Segal Huvelle of the United States District Court for the District of Columbia could complicate AT&T’s defense of the deal which has been already opposed by the U.S. government.
The U.S. Department of Justice filed a lawsuit in August to block AT&T from acquiring T-Mobile, saying that the deal would significantly reduce competition, increase prices and stifle innovation. Seven state attorneys general have joined the lawsuit. That case goes on trial in February before Judge Huvelle.
Where private plaintiffs have successfully pleaded antitrust injury, the fact that they are defendants’ competitors is no bar, Judge Huvelle said before allowing Sprint and C Spire to proceed with their claim that the merger would make it difficult for them to acquire wireless devices. The companies had claimed that after the merger AT&T and Verizon would be in a better position to get exclusive handset deals, while foreclosing their access to the most innovative handsets and raise their costs.
The court has ensured that it receives a fair hearing, Sprint said in a statement after Judge Huvelle’s decision. C Spire said it was pleased to get the opportunity to continue its fight for American consumers, and for the principles of competition and innovation that should drive the wireless industry. AT&T and T-Mobile could not be immediately reached for comment.