The Australian Competition Commission (ACCC) and Google have announced that the technology company has agreed to pay a fine of 55 million Australian dollars ($36 million) for entering into anti-competitive agreements with the country's two largest telecommunications providers. These agreements prohibited the installation of competing search engines on certain smartphones.
The Australian commission said it has initiated proceedings in the Australian Federal Court against its subsidiary Google Asia Pacific in Singapore. The court will decide whether the fine of 50 million AUD (36 million dollars) is appropriate.
See also: Apple continues to block competing browsers on iOS
Under the anti-competitive agreements, which ran for 15 months until March 2021, telcos Telstra and Optus would only install Google Search on Android phones sold to customers. Other search engines were blocked. In return, the carriers would take a share of the advertising revenue Google generated from those customers.
Google acknowledged that the agreements likely resulted in «significant reduction of competition».
Google also signed a commitmentthat requires the company to remove certain restrictions on pre-installation and default search enginefrom its contracts with Android phone makers and telecom providers.
See also: Europe: Apple files appeal against €500 million fine
The tech company said in a statement: "We are pleased to have resolved the ACCC's concerns, which related to provisions that have not been part of our trade agreements for some time."
For her part, the chair of the committee, Gina-Cass Gottlieb, said: “Conduct that restricts competition is illegal in Australia because it usually means fewer choices, higher costs or worse service for consumers… These changes come at a time when AI search tools are changing the way we search for information, creating new competition.”
The ACCC chairwoman aptly highlighted that the search market is changing due to AI tools (e.g. ChatGPT, Perplexity, Gemini). If competition is limited in advance, consumers will have fewer choices during a critical transition period. Therefore, such regulations are not simply a “punishment for the past”, but a safeguard for the future of the market.
Last year, Telstra, Optus and their smaller rival TPG agreed to commitments that they would not renew or enter into similar deals with Google to limit search options.
The ACCC shows how regulators around the world are getting tougher on Big Tech. The AUD 55 million fine is not huge in terms of Google’s financials, but it is significant symbolically. The requirement for a commitment to change contracts carries more weight because it could affect competition in the long term.
See also: Canada: Sues Google for anti-competitive behavior
The Google – ACCC case is a wake-up call:
- for Big Tech companies, that they cannot impose dominant practices without consequences,
- for regulatory authorities, that continuous oversight is needed,
- for consumers, that their choices in digital markets are directly influenced by agreements made “behind closed doors”.
Google in the sights of regulators
A few months ago, Britain's Competition and Markets Authority (CMA) launched an investigation into Google's (and Apple's) mobile ecosystems to see if there were any breaches of the country's new digital competition rules. The investigation covers operating systems, app stores and browsers on smartphones.
A little earlier, the same authority said it was launching advertising and search services Google's.
At the same time, in January, it was announced that Indonesia, KPPU, fined Google 202.5 billion Rupiahs ($12.6 million) for monopolistic practices in its payment system for the Google Play Store.
Enforcement of antitrust laws is essential to maintaining a healthy market environment where innovation can thrive, while also protecting consumers.
The investigations and fines against Google are a sign of regulators' ongoing efforts to hold big tech companies for their actions. There have been a number of similar cases in Europe recently, involving companies like Facebook and Amazon.
Source: Reuters
