Google to pay $36 million after striking deals that shut out rival search engines in Australia
Google on Monday agreed to pay AUD 50 million (USD 35.8 million) to the country’s consumer watchdog after it was found that its deal with Australia’s two largest telecom operators to pre-install Google Search on Android phones — while excluding rival search engines — had hurt competition in the market.
The Australian Competition and Consumer Commission (ACCC) stated that it has begun proceedings in the Federal Court against Google’s Asia-Pacific division. The court will now decide whether the AUD 50 million penalty is appropriate.
Why has Google been fined in Australia?
Under Google’s anti-competitive agreements, Telstra and Optus pre-installed only Google Search on Android phones sold to customers for 15 months until March 2021. The telecom operators excluded other search engines and, in return, received a share of the advertising revenue that Google generated from those customers.
Telstra, Optus, and their rival TPG agreed last year to court-enforceable undertakings with the ACCC, pledging not to renew or enter into similar deals with Google that limit search options for customers.
Google itself accepted that the agreements with telecom operators were likely to have resulted in “substantially lessening competition,” the commission said in its release. The tech giant has also signed an undertaking with the ACCC, committing to remove certain pre-installations and default search engine restrictions from its contracts with Android phone manufacturers and telecom companies.
ACCC chair Gina-Cass Gottlieb in a release about the fine said, “Conduct that restricts competition is illegal in Australia because it usually means less choice, higher costs or worse service for consumers,” ACCC Chair Gina-Cass Gottlieb said.
“Importantly, these changes come at a time when AI search tools are revolutionising how we search for information, creating new competition,” Gottlieb added.
Notably, a US federal court had also found Google guilty of maintaining a monopoly in the online search market through anti-competitive agreements with mobile carriers and device manufacturers. As per earlier reports, Google pays Apple around USD 20 billion annually to remain the default search engine on iPhones.
Meanwhile, an Australian court also partially ruled against Google in a lawsuit brought by Fortnite maker Epic Games, which accuses both Apple and Google of preventing rival app stores from operating on their systems.
