Google Faces Record EU Antitrust Fine Over Android Next Week

Google is expected to face a multibillion-euro antitrust fine by the European Commission that could mean changes to its Android smartphone business practices when the results of a three-year  investigation are announced next week.

The EC is understood to have rescheduled a briefing on the case with European competition regulators that was originally planned for this week to Tuesday, 17 July, because of the US president’s attendance at a NATO summit in Brussels this week, several reports said.

The Commission, the EU’s executive arm, is expected to issue its decision on the Android antitrust probe the day after that meeting.

That decision is expected to include a fine topping the record 2.4-billion euro (£2.12bn) penalty it issued to Google last year for favouring its shopping service over that of rivals.

Android contracts

The Commission is also expected to require Google to change its requirements for Android smartphone makers, which face various restrictions intended to ensure Google’s own software is included with Android devices.

That software, including the Chrome browser and Google Search, is an essential part of Google’s fast-growing mobile advertising business.

The Commission has alleged that Google forces device makers to include Chrome and Google Search if they place the Play Store app store on devices.

It also says Google breaks competition laws by barring phone makers from selling official Android phones if they also sell devices that run customised versions of the software.

Google says the rules ensure Android remains a cohesive platform, and that changes could result in fragmentation that would make things more difficult for developers.

Fragmentation risk?

The search giant declined to comment, but has said in the past that Android allows for flexibility and differentiation, and has increased competition in the smartphone market.

It isn’t clear what changes the Commission might require, with one possibility being that Google may be forced to change its contracts with Android phone makers.

Any changes that weaken or eliminate manufacturers’ requirement to install Google software on Android handsets could potentially cut into Google’s mobile advertising revenues.

Google would be able to appeal the decision, but would still need to comply with its terms while the appeal advanced or risk additional daily penalties.

A third pending Commission case involves Google’s AdSense search advertising, but the Android case is considered the most important of the three.