Google could be fined billions in its second inning against regulators in India
- Google in under investigation for using its
dominant positionto beat rivals in India — yet again.
- This time it’s not just about Google Search but the entire operating system of Google,
- Regulators from the
European Union(EU) set a precedent by issuing a record-breaking $5 billion fine to Google for the same complaint.
AdvertisementThis isn't the first time that the
Last time, Google had to fork out as much as ₹1.36 billion for similar violations. The CCI had then ruled that Google had a ‘search bias’ which favoured its own businesses.
This time around, CCI will determine whether it has been blocking rivals from its mobile operating system, Android, according to Reuters.
Android is the most common operating system in India — even more than Windows as smartphone users far outnumber the depleting number of PC users. That gives Google a ‘dominant’ position in the market and abuse of that power violates Indian laws.
The record breaking $5 billion fine
Similar antitrust practices have already cost Google $5 billion when the The European Union (EU) fined it for violations in its region. This sets a new record on how much a tech giant could be forced to pay out in damages.
Even though the complainants in CCI's investigation have not been disclosed, FairSearch — an anti-Google lobby group — filed the EU complaint against Google with competitors like Nokia, Microsoft and Oracle backing its claim.
European regulators, the European Commission, state that Google abused its dominant position in three key areas. One, they have been bundling Google Search and Chrome apps with Android, blocking out competition.
Two, the company is keeping phone manufacturers from creating devices that run a forked version of Android, wherein they can use some of their own code. Since Android is an open source code, it is possible for manufacturers to use a customized layer on the top.
But, according to the EU, Google was hindering their efforts and pressurizing them to sell Android’s stock version.
Lastly, Google has apparently paid phone manufacturers and operators \to get them to bundle the Google Search app on their respective devices.
What that means for Google in India
Though Google has appealed the EU’s decision, the precedent set by the European regulators could mean bad news in India. The extent of fine was determined by the size of the market, and damages could not be in excess of 10% of the company’s annual revenue.
In February 2018, when the CCI ruled that Google had a search bias, it was fined at 5% of its average total revenue from India.
This time around there are two factors that could change the situation. One, Google is now a second-time offender when it comes to antitrust practices. And, two, the EU has already set the bar for ‘damages’.
Between 2017 and 2018, Google’s India revenue has been grew at a rate of 30%, and stands at around ₹93.38 billion. Considering the popularity of Android in India, the damages could be higher too.
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