Google’s just been hit with Europe’s biggest ever antitrust fine

The European Union’s trustbusters want the search giant to cough up $5 billion as a penalty for using its Android mobile operating system to stifle competition.
The charge sheet: The EU alleges Google uses Android, which powers 80 percent of the world’s smartphones, to unfairly favor its own search engine and mobile apps by:

• forcing phone makers into contracts that require them to pre-install its search service and web browser in return for access to the Google Play app store and other products.
• making payments to large manufacturers and mobile network operators to get them to pre-install Google’s search engine exclusively on their phones.
• threatening to block phone makers’ access to its app store and search engine if they run versions of Android known as “forks” that haven’t been approved by the company.

What’s next: Announcing the EU’s decision, Margrethe Vestager, its antitrust chief, said Google must cease its anti-competitive behavior within 90 days or face additional penalties. Expect Google to challenge the EU’s ruling in court. The search behemoth has repeatedly claimed it faces stiff competition, from Apple in particular. It’s pointed to the fact that phone makers often install competing apps as well as its own as proof it isn’t suppressing competition.
Why this matters: The power of giant tech companies is a huge concern, as we recently highlighted. So far, Europe has led the way in challenging what it considers abuses of that power. It remains to be seen whether US trustbusters will follow its lead.

—Martin Giles