Google is set to appeal against the record €4.34bn fine it received for abusing the dominant market position of its Android mobile operating system, in the latest step in its eight-year antitrust battle in Europe.
The US technology company has until Wednesday to file its case with the European Court of Justice against the EU decision from July. That ruling took aim at a core part of Google’s business strategy by outlawing contractual restrictions that Brussels said had cemented its dominant position in general internet search.
With more than 80 per cent of the world’s smartphones running on the Android operating system, the product is vital to the group’s future revenues and profitability.
But in July, Margrethe Vestager, the EU competition commissioner, said Google had engaged in three practices that “denied rivals the chance to innovate and compete”.
Ms Vestager said that Google had forced Android phonemakers to pre-install its Chrome browser and search app as a condition of using Google Play, the smartphone app store.
The European Commission also determined that the company had paid manufacturers and network operators anti-competitive incentives to exclusively pre-install Google’s search app and prevented the companies from using rival Android operating software on any of their handsets. Google has denied any wrongdoing
The company has already appealed against a separate EU decision from 2017 to fine it €2.4bn for using its power to favour its own shopping services.
A third continuing EU probe is investigating whether the tech giant unfairly banned rivals from websites that used its search bar and adverts.
While the appeals will take years to work through the ECJ, Google has until 28 October to address the issues identified by Ms Vestager in the Android agreements.
The commission can fine Alphabet, Google’s parent company, up to 5 per cent of its average daily worldwide turnover if it concludes the company has not taken adequate steps to fix the abuses identified in the decision.
Ioannis Kokkoris, director at London’s Institute for Global Law, Economics and Finance, said: “The decision here is clear cut, the conduct here is clear cut.”
But he added: “At the same time there may be room to abide by the decision while trying to maintain some of the profitability that this conduct was giving”.
For example, if Android users were presented a choice of search providers when setting up their phone, many could — and probably would — still choose Google.
Agustín Reyna, chief competition adviser at the BEUC, the European consumer organisation, said: “Google needs Android to continue to push search and then they can monetise advertising. The CEO’s public statement the day after the decision shows they are taking it seriously.”
Sundar Pichai, Google chief executive, has defended Android’s existing arrangements, writing in a blog post in July that the EU’s “decision rejects the business model that supports Android, which has created more choice for everyone, not less” and that Google intended to appeal against the fine.
Google could try to delay their Android fixes by asking the European court to grant “interim measures” that would require them to make the mandated changes only after the court ruled on its appeal.
But Mr Kokkoris said the high legal requirements mean such a move would be unlikely to succeed.
Meanwhile, Thomas Vinje, a lawyer who has represented complainants against Google, said: “As we have seen in the search case, Google is extremely creative in avoiding the consequences of antitrust decisions, so I wouldn’t be surprised to see Google playing games with the Android [remedies] as well.”