New Delhi: Competition Commission of India (Commission) has imposed a penalty of Rs 1337.76 crore on Google for abusing its dominant position in multiple markets in the Android Mobile device ecosystem.

Google abusing its dominant position

A statement was released by the CCI on its action against the IT giant. It read, “The Competition Commission of India (Commission) has imposed a penalty of Rs 1337.76 crore on Google for abusing its dominant position in multiple markets in the Android Mobile device ecosystem, apart from issuing cease and desist order. The Commission also directed Google to modify its conduct within a defined timeline.”

The statement further stated, “For this purpose, the Commission delineated following five relevant markets in the present matter:

a. Market for licensable OS for smart mobile devices in India
b. Market for app store for Android smart mobile OS in India
c. Market for general web search services in India
d. Market for non-OS specific mobile web browsers in India
e. Market for online video hosting platform (OVHP) in India.”

Google argues competitive constraints from Apple

Google argued about the competitive constraints being faced from Apple. The statement read, “During the course of inquiry, Google argued about the competitive constraints being
faced from Apple. In relation to understanding the extent of competition between Google’s Android ecosystem and Apple’s iOS ecosystem, the Commission noted the differences in the two business models which affect the underlying incentives of business decisions.”

“Apple’s business is primarily based on a vertically integrated smart device ecosystem which focuses on sale of high-end smart devices with state of the art software components. Whereas Google’s business was found to be driven by the ultimate intent of increasing users on its platforms so that they interact with its revenue earning service i.e.,
online search which directly affects sale of online advertising services by Google,” it stated further.

Conclusion of the Commission

The Commission concluded that,

1. Mandatory pre-installation of entire Google Mobile Suite (GMS) under MADA (with no option to un-install the same) and their prominent placement amounts to imposition of unfair condition on the device manufacturers and thereby in contravention of the provisions of Section 4(2)(a)(i) of the Act. These obligations are also found to be in the nature of supplementary obligations imposed by Google on OEMs and thus, in contravention of Section 4(2)(d) of the Act.
2. Google has perpetuated its dominant position in the online search market resulting in denial of market access for competing search apps in contravention of Section 4(2)(c) of the Act.
3. Google has leveraged its dominant position in the app store market for Android OS to protect its position in online general search in contravention of Section 4(2)(e) of the Act.
4. Google has leveraged its dominant position in the app store market for Android OS to enter as well as protect its position in non-OS specific web browser market through Google Chrome App and thereby contravened the provisions of Section 4(2)(e) of the Act.
5. Google has leveraged its dominant position in the app store market for Android OS to enter as well as protect its position in OVHPs market through YouTube and thereby contravened provisions of Section 4(2)(e) of the Act 12.6. Google, by making pre-installation of Google’s proprietary apps (particularly Google Play Store) conditional upon signing of AFA/ ACC for all android devices manufactured/ distributed/ marketed by device manufacturers, has reduced the ability and incentive of device manufacturers to develop and sell devices operating on alternative versions of Android i.e., Android forks and thereby limited technical or scientific development to the prejudice of the consumers, in violation of the provisions of Section 4(2)(b)(ii) of the Act.