Can anyone concisely explain what this fine is for, and also why the same wouldn't apply to Apple for iOS?
It seems to be a rehash of the issue that Microsoft faced when it only gave you Internet Explorer on install. But iOS comes with only Safari on install, and forces you to use Apple's various apps - how is this any different?
Apple does not have a <s>monopoly</s> dominant position. In my country I think they are like 10% of the market. You can't abuse your dominant position if you don't have one.
Richer countries naturally have more iOS devices because those are more expensive. With Android, you pay with your privacy. Unless you opt out of GMS, but that's an all of nothing deal.
But for this case, they are using a definition that makes Android even more dominant: they allege that Google restricts device manufacturers' freedoms. And from a device manufacturer point of view, Android has a 90+% market share of "licensable smart mobile operating systems", with "licensable" being key: as a device manufacturer, you cannot use iOS, so that doesn't count if you buy into this line of argument:
That is fair enough - though is there really any competition in that space? Even if Google did nothing, I imagine most manufacturers would continue using Android as there isn't much choice. I don't actually know any mobile OS other than iOS and Android variants. Blackberry, Nokia (?) and Windows for mobile are all pretty much dead at this point.
It's also about giving the manufacturers more freedom in what "flavor" of Android they ship, e.g. currently Google forbids them from making both devices with Android with all the Google stuff and devices without it, or devices only using some of the package.
Seems kinda perverse. After all, you can't fork Windows, macOS, or iOS at all. Why should making Android more open than the competition lead to worse punishment?
It's not making Android more open that leads to the punishment here. Google made Android more open when they open-sourced AOSP; they made it more closed when they prohibited manufacturers from actually forking Android in a way Google doesn't like. The behavior that is punished is the use of their market power to negate the open-sourcing, not the open-sourcing itself.
They are free to fork Android though and use it however they want, as Amazon did. They just can't install the Google Play Store without including the other Google apps which Google claims are part of a unified experience.
Well, that's why they don't want to limit Android's market share, instead they want to open up Android licensing restrictions.
In particular, the EU alleges that if you want to install Google Play on your phones, you need to sign a license agreement which also forces you to:
a) install Google Chrome;
b) make Google Search the default search engine; and
c) not sell phones with Android forks at the same time ("Anti-Fragmentation Agreement").
They want to force Google to allow manufacturers to more freely chose which apps to pre-install and also to be able to offer Android forks in parallel to "Google-finish" Android.
I'm not sure if this will really be good for consumers... I would argue that most smartphones have too much crapware on them, not too little. On the other hand, the Microsoft Internet Explorer unbundling case arguably helped fuel the success of Firefox in breaking the IE dominance, which I would argue was good for consumers.
Of course there is. Mobile OEMs are quite capable of making their own operating systems and not so many years ago they all did. Of course Apple does, and Samsung still does with Tizen, from what I know.
These alternatives mostly suck but "your competitors suck" is not grounds for an anti-trust violation. No phone vendor is forced to deal with Google, that's an absurd distortion of the facts. Even if they feel their own in-house engineering abilities are so weak they can't make a better platform than Android, they can still take the open source code and use it as a base, providing their own mapping and app store along the way ... just like Apple do.
* Symbian
* Palm webOS
* Mozilla (I think that was also called WebOS?)
* Jola
* Some blackberry thing based on QNX that "supported" Android apps
* Tizan
* Windows Phone
* Ubuntu Phone
Plus a bunch of independent / hobby(?) ones that never really took off, eg the Inferno port
These days it feels like most people have given up trying to compete against Apple and Google.
I personally think the issue is more with the OEMs wanting to close their hardware than it is with developers and consumers (not that Im suggesting your point doesn't also play a part)
Probably UK, because iOS marketshare in UK is very close to 50% (52% Android, 46% iOS [1]). For curious, in some countries there is much more Apple iPhone users than Android users, like in Liechtenstein (58% [2]) or Monaco (64% [3]).
A monopoly is not defined by the possiblity that there are other products available for purchase on the market, but rather how many products have been purchased and are in use.
Using your reasoning, Microsoft could never have had a monopoly on Windows because you always could have bought a Mac.
That latter definition is in fact a reasonable counter-argument to Windows being a monopoly (people did buy Macs), and that's why Microsoft got in trouble for the deals they cut to try and crush Netscape, not for making a more popular OS than Apple did.
You can't define a monopoly as "your competitors aren't popular" because otherwise it'd be illegal to invent new product categories, as at the start you'd be the only player in the new space. You can't define it that way for another reason: it punishes success.
FWIW the definition of a patent is a "time-limited monopoly on working an invention", so all new products that are patented are monopolies by definition.
As the sibling comment rightly says, monopolies are acceptable. But, as the EU clearly point out, a greater onus is put on monopolies to avoid abusing their monopoly power.
That would work if patents were enforceable but they really aren't. I can't see a company that (re)invented a new product category where no competitors emerged because of patents.
A monopoly is exactly that. Mono means one. Thats the root of the word. What you are describing is a dominant position, which is completely different since its a relative definition.
The problem with this definition is that it also assumes that if you have 75%+ market share you're likely having a similar share of the profits which is not the case here. If you take profit into account it's really at best a 50-50 market for Google.
I agree that assumption is the wrong word. But do you have examples of monopolies that didn't take the profits and control the pricing of the markets they control?
Monopolies are not based on the profit but market share. Yes Apple has a very profitable niche but that does not mean Android does not have a near-monopoly on smartphones.
No, a monopoly is controlling a market to the point where competition is restricted via controlling supply or other means. A company can have 100% market share and not be a monopoly (which is always what happens when a new market emerges).
(Not OP:) In theory I agree. As soon as you have IPR like patents and copyright that are protecting the new product then you're inhibiting access for other companies; that is probably the case in a lot of new markets.
So if price pressure from consumers forces down your profit then you should be allowed to exploit a monopolistic position to leverage profits in another sector?
Like, own all cinemas in a country but home-viewing keeps profit low, so now it's fine to only allow people to visit your cinemas if they buy clothes from your clothing company?
A better example would be you own 75%+ of the cinemas but revenue wise you only control 50% of it. And in that case I think it's fair to do it. If they would force Apple out that would be a problem, but instead they even give you the basis for your own cinema for free (in contrast to Apple).
This is talking about from the perspective of phone manufacturer. As a phone manufacturer you can't license iOS so that's out. You can really only license Android and if you do you have to also install Google Apps, Chrome, and make Google the default search engine on your phone.
You are not required to license Android to use Android. AOSP and other versions forked from AOSP do exist.
There are.other mobile OSes available as well. I'm sure Microsoft will gladly let you use their OS for the right price, KaiOS, Ubuntu phone OS could be resurrected, you could role your own, I'm sure Symbian is for sale somewhere, how about Meego.
>In particular, Google has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks").
If you want to have Google apps on your phone you can't sell any forked android version.
Microsoft never had a monopoly in operating systems ever in it's history either. You could install CP/M on IBM XTs and you could run OS/2 or Linux or a plethora of other UNIXes on later IBMs and clones instead of Windows.
Doesn't mean they hadn't had market control due to it's market share.
> Nevertheless, the Commission investigated to what extent competition for end users (downstream), in particular between Apple and Android devices, could indirectly constrain Google's market power for the licensing of Android to device manufacturers (upstream). The Commission found that this competition does not sufficiently constrain Google upstream for a number of reasons, including:
They are not punished for their behavior in the downstream market (in which they barely participate). They are punished for their behavior in the upstream market. We consumers do not participate in the upstream market.
Nevertheless, the EU commission considered whether the lack of a monopoly in the downstream market ameliorated the monopoly effects in the upstream market and found it did not.
- has required manufacturers to pre-install the Google Search app and browser app (Chrome), as a condition for licensing Google's app store (the Play Store);
- made payments to certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices; and
- has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks").
> Market dominance is, as such, not illegal under EU antitrust rules. However, dominant companies have a special responsibility not to abuse their powerful market position by restricting competition, either in the market where they are dominant or in separate markets.
> Google has engaged in three separate types of practices, which all had the aim of cementing Google's dominant position in general internet search.
It’s about abusing the power of a monopolistic position in the market. The power being abused is the monopoly power.
If you don’t have a monopoly and do things your partners/competitors don’t like, they can’t complain that you are abusing a dominant market position to get away with it.
There’s nothing wrong with bundling. But when you have a monopoly on the market bundling suddenly is wrong and abusive even if it’s the right thing for your end users.
So we see time and again monopolies are knee-capped in the market and face these absurd fines, in the name of fairness and competition.
I have no doubt that some monopolies leverage their market dominance for some pretty atrocious dealings. I personally see nothing wrong with Google licensing the optional (but extremely popular) Google Play services such that it requires Google Search and Chrome along with it.
If they were unrelated then the experience of Google Play Services would be identical with or without the other pieces (Chrome and Search). I don’t use Android so I can’t say for sure, but I’m quite confident that the overall experience suffers without all three pieces together.
> If they were unrelated then the experience of Google Play Services would be identical with or without the other pieces (Chrome and Search). I don’t use Android so I can’t say for sure, but I’m quite confident that the overall experience suffers without all three pieces together.
The EU text talks about requiring chrome and search if the play store is installed. As a user of android, I cannot think of any way in which these are linked. I don't see why the play store wouldn't work without those two, or would even lose a single feature.
- has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks").
This is the most clearly anti-competitive practice.
I would argue that its actually pro-consumer - because if I was Google's CEO, I would just shut down AOSP, and wish that I had done it years ago, in relation to this ruling.
Google supports AOSP and has done so for years, making it available freely. Why shouldn't they be able to dictate their own terms? If phone makers don't like it, they can make their own OS (which they have - and they all suck).
> Google has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks").
Hence the fine.
You cannot have something open and control it at the same time.
if we are comparing to the microsoft case apple does have a monopoly. microsoft was not found to have a monopoly on computers in general. it was specifically found to have a monopoly on intel based computers. Apple has a monopoly on A9, A10, A11 based computers. A 100% monopoly
apple doesn't have market dominance, thats the claim, anyway this fine is stupid, see my comment about how volkswagen only paid 1 billion to germany for its emissions scam, europe is just trying to siphone money from american tech companies.
This isn't a revenue generating scheme. This is a fine for bad business practices.
This might shock you, but not every country in the world believes companies should have free reign to do whatever the fuck they like. It's not like deregulation is a requirement for capitalism.
The real problem here is the minority of Americans who live with their heads firmly up their own arses and don't have any concept of the wider world - of which America is literally only one entity amongst a great many of others. You assume that everyone is envious (which, by the way, is the correct term. "Jealousy" - as you described it in one of your other comments - doesn't refer to possessions) of America when in actual fact we just want American businesses to play by the same rules as European businesses do when those companies do business in Europe. You're not being singled out because we have the same expectation for companies of all nationalities; regardless of the continent they reside. It just so happens that American businesses are some of the worst offenders (possibly due to your culture of anything goes in business?). However as you have also pointed out, European companies do also get penalised when they break the rules too. So you aren't a special case.
But honestly, given the stunts Boeing pulls, your various business lobby groups that affect overseas legislation (eg the breast milk vs formula was), the recent changes to trade relations Trump has made, and all the other numerous indiscretions America make to put their own industries first; you are hardly in the position to take the moral high ground when it comes to international business relations.
> It's not just the administration. Every time the EU has levied fines against Google a lot of Americans on HN claim that the EU is doing it because they're jealous of how successful American businesses are.
> The European Commission has accused Google of abusing its Android market dominance by bundling its search engine and Chrome apps into the operating system. Google has also allegedly blocked phone makers from creating devices that run forked versions of Android.
Apple doesn’t have a dominent search engine to push down the throat of device makers.
They also don’t have an iOS consortium nor do work with other makers, so there is no bullying makers into doing what they want “or else”.
As others pointed out Apple is not in a majority position in the first place, but this fine is mainly bound to how the search engine and google suitr services come in the picture, and not on android on its own.
Firstly, Android doesn't have a monopoly. Apple does fine in Europe and their devices can be bought everywhere.
Secondly, there are device makers that didn't cut a deal with Google, notably the Amazon phones and tablets. They weren't that popular with consumers but that's not Google's fault: it just means consumers highly value the additional services Google provides.
Maybe the problem with the Google deal is that it's exclusive: if you want to make one device that's Google approved and contains the "highly valued" services, you are disallowed by the compliance contract to make other Android devices that are not Google-approved.
Yep, that is a big problem. If company A has launched an official Android device, and company B goes to A and asks them to build a totally unrelated Android-based (but not Android proper) device for them, A is not allowed to do that by Google.
But why would company B go to company A and ask them to make a phone "for them"?
It's not hard to become a phone maker these days, judging by the sheer number of Android OEMs that are out there (hundreds, I believe). If there was huge untapped demand for Android sans Google then a new company would appear, they'd download the Android code, they'd go to Shenzen and do a deal with a white label manufacturer, and they'd make such phones. Google wouldn't stop them because they'd be a company that doesn't make any other kinds of phones.
We know this is possible because there's one huge market where that's normal, China. Google's services are blocked in China anyway, so there's no point adding their app store or mapping apps. Local firms produce local versions of Android for their own market and it works fine. We also know this because Amazon tried it and they weren't sued or anything.
There are also open source spins of Android that have custom app stores like F-Droid. A new phone maker could ship those too.
You're missing the forest for the trees. The example was illustrative.
In general, when you see an example that explains a complex issue you should assume that it is significantly simplified and therefore will not be realistic.
First of all, Android is not only used on phones, but also for other types of embedded devices.
It's very normal that a company B would want to go to company A, if A already have a lot of expertise in Android. For instance a POS manufacturer might want to collaborate with Sony or Samsung on an embedded device which uses Android internally (without the GApps & stuff), but Sony and Samsung are forbidden from dealing with B.
Even Amazon would be happy to outsource some Android development to e.g. Samsung but they can't.
Maybe? Is there something about their business practices that shapes the market to their benefit? If so, and there are enough complaints then maybe not "next" but yeah.
> Is the EU going to fine ARM next for having a monopoly on mobile CPUs?
Having a monopoly or being in a dominant position is not the problem. If ARM starts a pizza business and requires everyone who wants to buy mobile CPUs to also order pizzas exclusively from them, then this would be an equally-fineable abuse of a dominant market position and the EU would almost certainly step in.
As it stands, ARM doesn’t force others to buy pizzas exclusively from ARM PIZZA PLACE and hence doesn’t abuse its dominant market position in one market (mobile CPUs) to support its position in another market (pizzas).
Google, on the other hand, uses its dominant position in the "licensable mobile operating systems" market to support its position in the "internet search" and "browsers" market together with anticompetitive behaviour forcing its licensees to exclusively use the Google-approved version of Android.
You can use Android and make a phone that searches Bing and uses your own app store. Look at how Amazon did it.
Most phone makers don't because customers prefer the Google services, but that's not Google's fault. They have provided OEMs with options - options they didn't need to give anyone, apparently, given that non-licensable operating systems like iOS aren't being whacked the same way.
The most Google can do is give away their OS as open source and let people do what they want with it. If they then sell a bundle of extra proprietary stuff on top, stuff that customers want, that can't possibly be more problematic than making everything proprietary.
After all, Apple doesn't even let third party devs from the app store take over the default mapping app: map links always open in Apple Maps regardless of user preference. For the longest time they wouldn't even let apps that competed with their own be developed at all. On Android you can replace the dialer and even the home screen.
I do understand why people are defending the EU here: they like its ideology and vision of the future. But trying to claim Android is some sort of market abuse when Apple's own approach apparently isn't just defies basic logic.
- by requiring mobile manufacturers to pre-install Google Search and Google Chrome browser and requiring them to set Google Search as default search service on their devices, as a condition to license certain Google proprietary apps;
- by preventing manufacturers from selling smart mobile devices running on competing operating systems based on the Android open source code;
- by giving financial incentives to manufacturers and mobile network operators on condition that they exclusively pre-install Google Search on their devices.
I understand that you can look at this in a way that makes it seem like Apple's tight control over iOS is equivalent to Google's tight control over Android, but there are some key differences:
a) Android has market share dominances (likely around 75% in Europe in 2018)
b) iOS is not made available for other companies to use
You could make arguments that iOS behaves unfairly to third party developers and end users, and there are some decent arguments to be made there, but none of them are relevant to antitrust law because a) means there is no market dominance to abuse with, and b) means there are no competitors to be abused.
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You said "Most phone makers don't [skip Google services] because customers prefer the Google services, but that's not Google's fault". I think this gets to the heart of the disconnect between your stated position, and the legal reality here (IANAL though).
If Google's services are supreme because of user choice, then Google should require no legal arm-twisting to push those services onto devices.
Instead, what has happened is that Google has over-reached with its Android services contracts (one example - if you want to use Google services on one Android phone, you can't make a second Android phone that uses your own services), and that is what the EU is tackling here.
You know that Samsung has their own app store, right? By your explanation that wouldn't be possible because they also ship the Google Play store. But it is. Samsung replace many other apps too. What Google requires is that their services are available, not that others aren't.
The different stories people are telling here about why Google is "abusive" don't correlate with the realities of how Android licensing actually works.
Also since when is 75% market dominance? 75% is popular but that's still a quarter of the population successfully choosing an alternative.
Samsung phones are very often dinged in reviews because they ship a confusing mix of Samsung apps that duplicate the functionality of Google apps. I wouldn't be very surprised at all if Samsung would prefer to just ship their Calendar/whatever app, or even entire phones that only contain their apps/services, but they can't make those choices.
Regarding the 75%, please bear in mind that that is across the total market, which covers a very broad range of price points. Apple may have ~25% share, but that is skewed almost entirely to the top end of the market. In the low end of the market, Android would be nearly 100%.
So what you saying "one example - if you want to use Google services on one Android phone, you can't make a second Android phone that uses your own services" is wrong then?
No, it's not wrong. Samsung is allowed to add its own Calendar/Calculator/whatever apps, and their own App Store, but they are not allowed to remove Google's ones without dropping every non-AOSP Google app/service from every one of their android phones.
If they abuse their position e.g. by forcing device makers to sign contracts preventing them from using RISC-V etc., then yes, EU might get interested in that, too.
It's not that at all. It's abuse of dominance, not the dominance itself that's the problem.
They're using a dominant position in one market to push services in an unrelated market. That's anti-trust 101. And they punish suppliers who don't tow the line.
This is exactly the same as the MS anti-trust case. Swap IE for Google Web Services (Search/Maps/Chrome) and swap Android for Windows.
If ARM started forcing phone companies using their CPUs to only sell to AT&T, that's your analogy. As it is, because ARM don't force unrelated services or products on their customers, it's not analogous.
Sorry if it was unclear. The first issue is Google pushing the search engine on mobile devices.
For context they also push Google search to iOS devices (Apple gets huge amount of money for that), the same way as they pay firefox to have Google as their default search engine.
The issue though, is that for android phones, it's not a "let's make a deal, we will pay you to have Google Search" attitude. You can't make an android device integrated with Google Play app store without also having Google Search in the home screen and as default search engine.
What the EU is fining among others, is the business practice of forcing device makers that want to use the Play Store to also bundle the other service (Search).
Which is a kind of silly decision on Google's part, because they have far and away the superior product and also the superior brand. Even if the option was given at setup, nearly everyone choosing to buy an Andriod phone would select google as the default search engine...
(I guess you could say that didn't see this coming, but the parallels with MSFT and IE are pretty hard to not see...)
The fine is going to hurt a lot more than any remedial action.
Much of their entire dominance as a company hinges on pushing defaults, and their ability to force manufacturers to ship Google apps, on any phone sold in the EU, is a massive blow. The penalty is chump change for Google, but the remedy is what is going to hurt long term, because competitors can finally get in the game.
People will still just chose to use Google. Look at Windows in the US and Google dominates browsers, search, YouTube, etc.
This is just a shakedown of Google. In the end the EU consumer will pay the price. Sure glad I live in the US. Just hope Google treats the EU differently than the US. When switch to Fuchsia just charge for it in the EU and give for free in the US.
The consumer will pay more for a phone and still use Google services making Google even more money.
As an independent phone maker, if this was their concern, they should have backed one of the other dozen or so attempts at a phone OS. No one forced them to choose Android.
They also have the option to write their own OS anytime they want.
Well, there's nothing all that special about the output of a political commission. And the fact that 1 in 5 devices don't run Android would seem to contradict the monopoly accusation.
Antitrust does not require a monopoly, it just requires enough of a market dominance that hurting the market is feasible for you, and then exploiting this position to actually hurt the market.
Basically, all you have to do, is hurt the market in noticeable ways. The sole goal of antitrust laws is keeping the market healthy. They're not fair and have almost no rules attached to them.
So Google could solve this problem by raising the price of its OS, increasing profits and decreasing market share, and leaving a billion with no access to smartphones at all.
It does have a dominant market position though, and that's what's in the legal stuff that they're being fined under. You do not need a complete monopoly to have a dominant market position.
> Secondly, there are device makers that didn't cut a deal with Google, notably the Amazon phones and tablets. They weren't that popular with consumers but that's not Google's fault: it just means consumers highly value the additional services Google provides.
More than that though, they effectively stopped device manufactures from selling these (because of exclusivity agreements), and a lack of range isn't going to have helped amazon:
> For example, the Commission has found evidence that Google's conduct prevented a number of large manufacturers from developing and selling devices based on Amazon's Android fork called "Fire OS".
Thanks for this. Anyone who has tried to compile a forked version of AOSP knows that Google makes it extremely hard to do so.
Android being an open source OS is nowhere near as easy to install as a regular linux open source OS.
I've been trying to get my own android / androidTV box working on popular hardware like rPi and other Amlogic, Allwinner, Mali based boards without much success. Even devices manufacturers have troubles with the same (talking about SBCs here).
Android is open source only for name sake. Google's deliberate control over the entire Android ecosystem is undeniable.
AOSP does not include proprietary apps like the Play Store, etc.
In order for device manufacturers to get the Play Store on their phone, they have to give in to Google's demands to add the Google search box on the home screen of the phones.
Apart from this, Qualcomm doesn't release open source drivers for GPUs etc, making it even harder to use pure AOSP on flagship devices.
Qualcomm blocked Google from using Proprietary Android on its devices! One of the Nexus phones couldn't upgrade the OS to the next version due to Qualcomm drivers.
> In order for device manufacturers to get the Play Store on their phone, they have to give in to Google's demands to add the Google search box on the home screen of the phones.
What's wrong with this? The Play Store is subsidized by search revenue, it makes sense to tie them together.
Android forks in China are not undermined by the lacking open driver support for Android.
There's a bunch of SBC manufacturers (pine64, odroid, orangepi, etc) worldwide that have managed to compile AOSP for questionable hardware. However, it is noteworthy that almost none have been able to compile images for Android 7.1 and above that work without hiccups.
Are you saying that simply because a multi-billion dollar company with top engineering talent is able to compile a version of Android that this disprove the comment you're replying to?
I'm not buying your first point. Within a month of OEMs releasing the Kernel sources, you can find builds of AOSP over at XDA, Lineage OS and other forums. And with the project Trebble in P, we have builds within a week. I don't think it is hard or Google is making it hard to compile.
As for your problems installing it on other boards, where are the drivers for them? Your classic desktop installation comes with drivers for almost every laptop/desktop board. Android doesn't because the vendors don't contribute. A snapdragon SoC requires a binary blob from Qualcomm. There is nothing you can do without it. It has nothing to do with AOSP being opensource or Google controlling it (Google controls other aspects, AKA the Play Services).
Apple doesn't license their OS to OEMs. I'd say them blocking alternative browser engines is controversial though. Also they dislike people using certain libraries, emulator technology, providing the ability to execute downloadable scripts (e.g. flash), etc.
Fining anti-competitive practices only makes sense when it's successful.
The EU laws around this are also worded as such. You can do anti-competitive behavior all you want if you're not a major player because you'll just be shooting yourself in the foot.
The logic is that you're not allowed to use your position in one marked to gain influence in another.
Google knows that most manufacturer needs their devices to ship with the Play Store, because that's where the apps are and smartphone without apps are useless. But they use the Play Store as leverage, forcing manufactures to also ship Chrome, rather than Opera, Firefox or their own browser and that's the bit that is illegal.
Imagine that Apple forced telcos to block Spotify, to force users to iTunes, and if they didn't then no iPhones on that carriers network.
That being said I don't think Google is using the Play Store to force installations of Chrome or the Google search app, that's just weird. People would install Chrome anyway and they already dominate search, so why bother. I think the reason is technical, but the end result is still illegal.
> Most companies aren't in multiple different markets.
If you sort public companies by Market Capitalization, how far down the list do you think you need to go, before you find a company that is only in one market?
But Apple does pre-install iTunes/Apple Music, and make money when users use the default music app rather than downloading alternatives. You gotta pay for the OS somehow, but people aren't willing to pay for OSes. So instead, Apple makes money through the bundled hardware (to use iOS, you must buy an iPhone) and Google through the bundled software (if you want to use some Google apps like the Play Store, you must also use other Google apps like Chrome and Search).
"But I can't make this work unless I squash the competition by abusing my monopoly" is not a good argument for allowing it to happen, even if it were true here. The alternative is not to have no operating system, but to have a healthy market of other, possibly smaller, likely more operating systems instead.
In real life more operating systems means crappier software because now developers need to create versions for each one in order to be profitable, and not the "vast array on awesome options" open source enthusiasts would like to imagine.
It's a constant tension. In the real world single party government is more efficient than multiparty democracy. But most of the world hasn't clamored for single party rule unless it's their personalo preferred party
Yeah, what Google is learning here is that you should never license your OS/sell to other manufacturers and never make it open-source and just go the Apple route instead, create the device yourself and make the OS completely proprietary and closed.
If Google manufactured all Android phones, and Android were closed source, and Android came pre-installed with the Play Store, Search, and Chrome, I think it wouldn't be a problem, right?
Again, they can be ‘open’ (sell/give to other OEMs), they just can’t use contracts to force those OEMs to help them dominate other markets/kill Android competition.
That’s what they’re doing here, just like MS did in the 90s with Windows licenses.
Exactly. The EU is going to force Google to do stuff that hurts the consumer not helps. Just hope Google limits it to the EU and let's us in the US continue with a great deal that Google offers.
Which would allow google to gain dominance in the mobile market... NOT.
Google/Android won because it was very open and flexible, but the moment they started to dominate they started to push their agenda on OEMs users…
Okay, now I am starting to see the argument against Google. Essentially, that they captured a lot of the market with "free" but are increasingly using the terms that come alongside this "free" to bully other manufacturers now that they're locked in with "free Android!".
They tried, but then Google had "free OS" that "everyone used" so it was almost impossible to make a dent in the google-verse. And now when they killed virtually any competition they are pushing their agent.
Recently KaiOS was gaining traction and what did google? Virtually bought their presence/dominance there… sorry "supported project".
Based on what I see around me, people just use the first browser they see. Until someone with technical know-how comes along, people will use Edge on Windows (and usually complain about how the internet is acting up, but that's another story).
The same goes for Samsung and its own browser, simply called "Internet": people often have heard of Google Chrome but won't go looking if there's a working "internet button" right in front of them. Other vendors use the same trick.
Personally, I would think this is a good thing as it takes away some of the monopoly Google has, if Samsung etc. would just give their browsers regular updates through the Play Store/their own app store (latest version I can find on the Play Store still uses Chrome 59).
There is no technical reason to install the Google app or to install Chrome. Vendors can easily install their own WebKit/Blink engines for all the WebView/technical requirements (as seen by alternative ROMs) and the Google app can be deleted without affecting the other Play Services.
I think this is a ploy to prevent companies like Microsoft from coming with their own ROMs that focuses on Microsoft applications (Cortana, Bing, Edge mobile, Outlook, Microsoft Office etc., MS have a near complete stack of applications for Android) without offering any pre-installed competition like Google does.
Which only serves as strengthening Chrome's position (Chrome being a I/O vector for Google's ad market).
> and they already dominate search, so why bother.
Which obliterates any chance of a remotely widespread alternative emerging. The homescreen search bar is technically a widget like any other yet it is the only one that cannot even be removed from any stock launcher!
Imagine a manufacturer whose part of its proposition (whether through deals or genuine customer interest) is for whatever reason to sell a phone that comes loaded up with Firefox (or Opera) and has Bing (or DuckDuckGo, or Qwant) as a search widget. This is currently impossible and the decision aims to change that. The fact that Google uses its Android - because there is no viable alternative platform - and Play Store - because without the apps the platform is useless to the general public - dominance in the phone market to strong-arm manufacturers into preloading extensions of its search and ad market is a huge issue, turning the "Google experience" on Android into an all-or-nothing proposition.
But there is a related yet more subtle issue that isn't addressed: log into the Play Store, and you're helpfully logged into all other Google services such as Gmail, Chrome, Calendar, Photos... The only thing you can subsequently prevent is automatic syncing, but cannot disable each one of those services at all (unless you disable the whole app). So basically you log in to download whatever app on the Play Store and you turn on a huge firehose aimed at Google's datacenters. As an Android user the feeling I have of the "Google experience" is one of coercion, not freedom.
BTW your iTunes/Apple Music example is interesting, although it could be developed further to better match the situation.
> Imagine that Apple forced telcos to block Spotify.
But they do. Telcos are not allowed to pre-install Spotify on iPhones, are they? iTunes on the other hand is pre-installed along with Safari, Apple Maps and Apple Podcast.
Of course once you have the device you can do whatever you ... can. Similarly once you have your Android phone you can install an alternative browser.
In fact I have had Samsung phones with two app stores and two browsers. Guess which one was was I unable to delete without rooting the phone first?
I am not a fan of whataboutism, but in this case it just seems unfair that the creator of a (more) open ecosystem is taking all the beating.
Note: I actually hate the search widget as well as the assistant, but there are hundreds of alternative home screen apps.
>Imagine that Apple forced telcos to block Spotify, to force users to iTunes, and if they didn't then no iPhones on that carriers network.
Doesn't Apple already do this with the App Store? You can't buy an iPhone with Spotify pre-installed and Apple Music can leverage its position of not having to give another company a 30% cut to undercut spotify's prices.
going from the actual ruling against microsoft, that ruling was microsoft had a monopoly on Intel base computers and not computers in general. Apple has an even larger monopoly on A9, A10, A11 based computers. in fact they have 100% monopoly for those computers
Exactly. Google isn't blocking other browsers, so the analogy is flawed. Apple is forcing iTunes to be pre-installed, so they are using their dominance on the iPhone to push many other services.
Neither of those actions are illegal per se, but just because you it's not illegal to dictate terms doesn't mean you're allowed to choose any terms you want.
The problem here is that Google allegedly dictated terms that gave them an unfair advantage in an unrelated market, breaching EU antitrust law.
A stricter antitrust law might have prevented them from gaining such a dominant position in the first place, but that doesn't seem to be the issue here.
IF Google had manufactured all of the phones themselves, and had never open sourced Android, then they could have kept Chrome and Search on Android, and there would have been no problem, right?
But because Google let other people manufacture Androids, and because Google open sourced Android, now it's a problem?
No, Microsoft was fined for forcing OEMs to install IE and not preinstall other browsers on PCs if they wanted Windows. It had nothing to do directly with end users.
Google didn't write all of Android, there are GPL components. They didn't have the choice to keep it closed source, all of it anyway.
And secondly, they're not being punished for having an open source operating system. They're being punished for forcing manufacturers to install their suite of software (simplified). It's not because they open sourced Android. I repeat, it's NOT BECAUSE THEY OPEN SOURCED ANDROID.
The terms wouldn't prohibit Samsung from making phones with another OS.
The terms would say that Samsung installs the version of Android 2 (the new and closed source one) that Google tells it to. As manufacturing partners are always told what to do.
Google is exactly in the same position as Microsoft when they were caught red handed doing shitty stuff with the vendors.
The interesting part is both Microsoft and Google prioritized licensing/delivering the OS and associated software, keeping a healthy distance from building hardware. Google tried a bit more with the Nexus/Pixel programs, but even then the target was only for small scale niche devices.
What I am driving at is that once android got traction, Google’s position went way up while vendor’s bargaining power went down, even as vendors where the ones taking the risks down the line. That kind of unbalance makes it easier to have abusive contracts and business practices.
It starts with good intentions (working symbiothically with the makers at innovative products) but things change, and with success I’d guess different kind of people also come into the organization to push more aggressive practices.
Apple has no monopoly on any hardware market where they are not the only one. They cannot dictate terms to any other OEM manufacturing A10-compatible computers.
It is for having a dominant market position in mobile phones (90% global market share) and abusing the market position in mobile phone operating systems to favor their other products.
Apple does not have a dominant market position and does not give away iOS for free.
Making Android free is an anti-competitive practice because it inhibits the formation of a competitive market for mobile phone operating systems. Because Google's practice of making Android free inhibits competition they are not allowed to exploit the lack of competition for profit.
I don't see this reasoning at all. The fine is because Google is illegally cementing it's position as a dominant search engine through licensing of the android platform.
This is more about google forcing OEMs to bundle a ton of google apps and making them default in order to get google play services. If you are an OEM, you have to accept the all or nothing proposition if you want google play. And all OEMs want google play. The android as you know is AOSP + google play services blobs. Nobody sells pure AOSP phones (not counting some small niche players).
In their Statement of Objections, the European Commission accused Google of the breach of EU antitrust rules in three ways:
- by requiring mobile manufacturers to pre-install Google Search and Google Chrome browser and requiring them to set Google Search as default search service on their devices, as a condition to license certain Google proprietary apps;
- by preventing manufacturers from selling smart mobile devices running on competing operating systems based on the Android open source code;
- by giving financial incentives to manufacturers and mobile network operators on condition that they exclusively pre-install Google Search on their devices.
My understanding is that the "certain Google proprietary apps" most importantly contain the Play store. Yes, in theory you could install FDroid - however if you, as a manufacturer, don't want to break the "install our app" flows of basically every website, you need the Play store - and therefore you also need to install Chrome, default Google Search and never sell a phone with Lineage OS installed ever again.
Not sure if the same licensing also applies to Google Play Services - if yes, this might make it difficult to even run the apps without getting the license, no matter which store is used.
The margins of the Play Store are huge and it's quite easy to disrupt with a copy cat - the developers will flock to an alternative store with similar functionality and 2% fees. And of course customers.
The Play store is the crown jewel and protecting that massive revenue stream is paramount, it could well become the most important software market in the world.
-Developers
-Customers
-To be able to survive on fees less than it costs for a credit card transaction
-To be installed on something better than Android
The only thing a copycat needs is that manufacturers be allowed to install it as the default app store, without ruining their relation with Google.
Once that happens, copy cats will pay manufacturers to preinstall, leading to customers, leading to developers who want to tap that still uncrowded market. And once multiple app stores bootstrap, a price war is inevitable - margins of 30% would be undefendable since they would be passed on to the consumer who would switch to a cheaper app store.
It's very clear why Google would want to prevent such a race.
That proprietary software is probably Google Play Services because replacing Play Store is relatively easy. For example, in Russia Yandex wanted to make its own store and in China (where Google is blocked by the government) there are several competing app stores.
Google Play links on websites are not the problem because on Adroid an app can use App Links [1] to start an alternative store instead of opening a Play Store page in a browser.
1. They should release a heavily locked-down version of Android, which manufacturers and carriers cannot modify - apart from basics like bundled apps, widgets and wallpapers (uninstallable). Update would come direct from Google, and hardware support would be limited to specific components.
2. Make all of Android closed source and shut down AOSP. What is the point of it anyway?
This would solve the fragmentation problem, and be better for consumers since they would get updates quicker and for a longer time. Paradoxically it would lead to less 'choice' for consumers.
I don't get it either with regards to the Microsoft case. You need a browser to start with but you can install any browser available. Android doesn't block Bing, or any other search engine. So what's the problem?
Apple defenders will dismiss market share when comparing Android and iOS and claim that share of profits is all that counts. But they're happy to use market share to justify sanctions against Google. You can't have it both ways folks.
The fact is that Apple controls enough of the users that everybody wants that they have at least as much influence as Google does in mobile. That they've chosen to protect their fat profit margins and accumulate the largest pile of corporate cash in history while ignoring customers that can't afford premium devices should not insulate them from similar scrutiny.
If the EU wants to preserve any credibility on these issues they should take a hard look at Apple's refusal to allow other browser engines on iOS.
Looking at the comment below enumerating the reasons for the ruling, I don't see any overlap between what Google is being fined for and Apple's business practices. Apple isn't forcing 3rd party OEMs to install Safari on their hardware in order to run Apple apps because Apple makes all their own hardware. iOS is not an open source OS meant to be available to third parties, and Apple doesn't have a search engine to pay carriers to mandate.
>requiring mobile manufacturers to pre-install Google Search and Google Chrome browser and requiring them to set Google Search as default search service on their devices, as a condition to license certain Google proprietary apps;
>preventing manufacturers from selling smart mobile devices running on competing operating systems based on the Android open source code;
>giving financial incentives to manufacturers and mobile network operators on condition that they exclusively pre-install Google Search on their devices.
You missed my point. Effectively there is more than one kind of monopoly and Apple has just as much control over the mobile space as Google does and abuses it in their own way by pushing their browser, disallowing third party app stores and alternative default mail, maps, etc. Expect to see more of this as Apple starts to rely more and more on services revenue.
Apple currently pulls in an astonishing 87% of mobile profits. Why on earth should they be excluded from anti-trust scrutiny?
Because they don't control the devices of 87% of users. Their profits are good for them and all, but have no direct bearing on their ability to exert unfair influence, especially in other markets (e.g. search engines).
They have plenty of influence for developers, which means they have influence for consumers. They have a huge say in what apps and websites get built and how because everybody has to play by their rules to get on their lucrative platform. Do you think you could launch a successful search engine today that wasn't available on iOS?
Take Safari as a case in point. Apple doesn't allow other browsers on their platform which means webdevs have been limited to the parts of the web stack that Apple supports. Which, until recently, was falling pretty far behind the state of the art.
Marketshare is marketshare and the numbers are clear. Yes, Apple is more influential than its marketshare indicates, but that is hard to quantify (especially legally) and in any case probably not as large an effect as you think.
They are not excluded. They are just not breaking the law that says you cannot force manufacturers to bundle your market-leading-services to gain an unfair advantage in other markets.
Apple might be breaking other laws, but not this one. Google is breaking this law. Hence the fine.
Google is being accused of using its dominance to force __manufactures__ into setting Google search as default, Chrome as default browser and not selling phones with Android competitor like LineageOS
Apple is incapable of abusing manufacturers as Apple does not work with manufacturers at all. The entire discussion simply does not apply to Apple.
This one is much worse because although Microsoft tried to get complete control of the PC platform many years ago, they never managed to prevent people from installing other operating systems on their PCs. Had Microsoft the same power Google has now on mobile platforms, I would be writing this post using Windows 10 instead of Debian because Linux as well as *BSD and others would either not exist or could never properly work due to lack of OSS drivers which is by far the #1 plague in the mobile world.
Google monopoly has very little to do with Chrome bundling and a lot with hardware being kept tight closed to kill any competition: the day we have OSS drivers is the day we can have other OSes (which have been already written) fully working; that will allow also software to be fully usable, creating more competition Google will have to respond to, hopefully with more openness and quality.
Before someone replies that drivers have nothing to do with browser bundling, think about how could Google force you to install anything or use any of their services if your underlying OS and surrounding environment didn't depend on anything from them because it wasn't even Android. Example: https://www.gnome.org/gnome-3/
Google monopoly is a byproduct of proprietary hardware/firmware, that's what a lot of people is missing. Going every time after this or that corporation because it built a monopoly is useless when trying to build a monopoly is everyone's untold ultimate goal in the current economic system; we would better spend our energies making sure that nobody can't even attempt to build a monopoly, and open specs hardware would be one step in this direction.
I can understand telcos wanting a closed layer before the radio section to prevent people from tampering with cell service, but to me everything else has to be open.
Man, some of these could be Corp-explained away by some savvy PR person but why the heck would you buy a URL that is like your competitor and point it to you, other than to deliberately stifle competition? I would like to hear the response from Google on that one.
Apple is simply imposing such onerous terms that no OEMs can sell iOS. But because (as a result of this anti-competetive behaviour) their market share in the OS market is low, it doesn't break the law.
Then why isn't Google allowed to not sell their software to others to use? Google doesn't want to let Amazon have the Play Store without following conditions, they should have that right.
I am arguing there is no real difference between tying, and not selling to 3rd parties at all and only using your product in a vertically integrated business. Vertical integration amounts to tying with extremely onerous requirements that only the selling company (i.e. Apple) can meet.
Microsoft got into trouble because they forced companies like Dell and HP to make their products feature Internet Explorer.
Google is getting into trouble now because they're forcing companies like Samsung and LG to make their products feature Chrome.
Apple is not getting into trouble now because Apple is not forcing Apple to make their products feature Safari. Obviously iOS does feature Safari, but Apple was free to make that choice. There is no OEM here being bullied.
A red herring. Every product on the market—from toasters to lawnmowers—contain numerous choices made by the product manufacturer and not by the end user.
iOS is much worse. You aren't even allowed to install another browser. "Chrome" and "Firefox" on iOS are not real Chrome and Firefox, they are wrappers around Safari's webkit engine.
Volvo is a much smaller company with much less revenue serving a small market share of a smaller market. With fines based partly on revenue, this difference makes perfect sense. Unlike your comment.
Paywalled. Small article. Copy pasting entire article as comment.
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BRUSSELS—The European Union plans to hit Alphabet Inc.’s Google with a record antitrust fine of €4.34 billion ($5.06 billion) on Wednesday, according to an official familiar with the matter, a decision that could loosen the company’s grip on its biggest growth engine: mobile phones.
A formal decision—which would mark the EU’s sharpest rebuke yet to the power of a handful of tech giants—is set to be taken during Wednesday morning’s meeting of EU commissioners following a presentation by competition chief Margrethe Vestager, according to the person. No discussion of the decision is expected, the official said.
The EU’s antitrust regulator has been looking into whether Google had abused the dominance of its Android operating system, which runs more than 80% of the world’s smartphones, in order to promote and entrench its own mobile apps and services—particularly the company’s eponymous search engine.
Google, which can appeal, has rejected the EU’s case since the bloc issued formal charges over two years ago. Google says Android, which is free for manufacturers to use, has increased competition among smartphone makers, lowering the prices for consumers. Google also says the allegation that it stymied competing apps is false because manufacturers typically install many rival apps on Android devices—and consumers can download others.
The fine would top the EU’s €2.4 billion antitrust decision against Google just over a year ago.
Wednesday’s expected ruling would be the latest in a series of decisions in which the EU has cast itself in the vanguard of a backlash against U.S. tech superpowers, on issues ranging from competition to taxes to privacy. Ms. Vestager has become the face of that battle, arguing that regulators must do more to restore fairness to the digital market.
The EU’s executive announced Wednesday morning that Ms. Vestager would give a press conference at 7 a.m. ET.
Write to Laurence Norman at laurence.norman@wsj.com
> Despite being a record fine, Alphabet generated about the same amount of money every 16 days in 2017, based on the company’s reported annual revenue of $110.9 billion for the year.
A fine comes out of your profits, not your revenue. From a Routers[1] source they had $110.9 billion in revenue, but a profit of $12.6 billion. So this is somewhere between a third and half of their global profits.
Such fines are also recurring if the issue is not rectified. Of course no company that ever had to pay the fine tested this principle :).
I'm pretty sure they'll fight it just like Intel is doing.
That’s not the only way. Independent government auditors could make their own profits assessment and work off that. This is exactly what is done in other jurisdictions and other industries.
Let's say you have one profit bringing business unit like google ads. (Let's call it main unit) but you also have internal startups in your company (side units). But you only have one operations department, only one HR department etc. How do you account the expenses of these departments in relation to main business and the side units?
You can't. If people are not forced don't write down exactly whether they spent their time on working for the main unit or the side units units, you can't later account it correctly. Unfortunately it's not even clear for the company what happens sometimes. You might for example hire an employee, but place him in a different business unit than originally planned. Or the employee later on changes business units.
The other problem with this is even if you require such a strict accounting setup, you can't tell whether employees and/or departments are accounting their efforts correctly, it's just incredible difficult to enforce the rule; to make sure they don't lie.
Even if you think hey you can do it, you have to rigorously enforce this for all companies in your juridiction, because as soon as you stop looking, they will stop caring.
So the problem is you can't tell the profits before "internal investments" as long as you can't pin down operational costs.
You'll see that the only thing that you can accurately account for is the main business units revenue, but you can't give a precise number on operational income. (Which is revenue - product costs - operational costs).
The setup explicitly allows for contextual customization of approach. You’re right that it is too complex an issue to precommit a strategy, which is why you don’t. It’s up to the discretion of the judge and the court as to what accounting strategy is used in the audit. If the company thinks it is unfair they can fight it as part of the proceedings or under an appeal.
To put it in a slightly different context, this is more money than the annual contributions of quite a few EU member states. Google is now a bigger contributor to the EU budget than Belgium, the Netherlands or Ireland.
Fines paid to the EU go straight into its own general budget. Combined with the nature of the EU Commission as judge, jury and executioner in cases like this, it is a severe conflict of interest. Member state are refusing to pay more into the budget and the UK is leaving, which will create a massive budget hole. The EU is strongly incentivised to levy fines for vaguely defined, highly debatable "crimes" on US tech firms in order to avoid their own internal political disputes over funding.
The executive fines someone (like you are fined for violating parking regulations), then you can appeal that fine in court, in this case most likely the ECJ.
Would you argue that it's wrong to address a coporation's wrongdoings? EU companies are fined regularly as well, might not create such an upheaval in the US media, though.
If the government believes people have broken the law, in a democracy that means civil servants have to launch a criminal case and win a prosecution.
The EU is not structured like that, and thus doesn't have to win any prosecution. Margrethe Vestager just issue a proclamation with a number she and the Commission picked out of the air, and the deed is done.
That's a very narrow (and in my opinion even wrong) understanding of what constitutes a democracy. Prosecuting companies via criminal lawsuits might be the American way but that does not mean every democracy has to have those same rules. If an administration fines a company and there is the possibility to appeal to a court that is also a democratic process. My homecountry Germany uses this process (companies are never sued in a criminal lawsuit) and I don't see a reason why that would be undemocratic.
First: this is a civil law fine. In the E.U., companies are not subject to criminal law, only individuals are. It’s not much different in the US, where antitrust actions are also civil.
Second: Google can appeal in court. It’s exactly the same as it is in the US.
Neither is the US. Numerous state and federal agencies have the right to directly levy civil penalties. You have the right to challenge those penalties in court, as you do in the EU.
They can but it would just invite further action from regulators. Which is why they will comply with the requests (not without a fight) even if just in name. I'm sure there are other ways they can get the same benefit as a monopoly without running afoul of the concrete requirements put in front of them by now.
If a company simply ignores fines, the regulators will assume that they didn't choose high enough fines, since it did not hurt the company enough. They'll schedule another meeting, check whether the company still breaks the rules in the same way and if so impose fines which are a lot more painful.
You can expect that to happen way faster and with way less bureaucracy then the initial fine.
it'd be interesting to imagine how a company could potentially still operate in a hostile country, if said company is only dealing with cyberspace products (such as software/saas).
Would they be able to continously ignore any/all rulings, by operating the datacenter, and any payment mechanisms, outside said hostile country?
>Can Google just continue their practices after this?
Seeing as nobody else has read the article.
>If Google fails to ensure compliance with the Commission decision, itwould be liable for non-compliance payments of up to 5% of the average daily worldwide turnover of Alphabet, Google's parent company. The Commission would have to determine such non-compliance in a separate decision, with any payment backdated to when the non-compliance started.
"Profit fell 35 percent to $12.6 billion because of the tax bill and a separate charge last summer for a $2.7 billion European Union antitrust fine, which is under appeal."
Thanks. Looks like they are getting used to paying fines as a regular part of their business.
Maybe in future earning reports we will see statements like "Legal fines went up 80% YOY from $7B to $12B and we are planning to continue our aggressive spendings in this area to expand our market dominance".
When the fines are lower than the expected benefit from your "wrongdoing" then what's the incentive to stop?
As a person getting caught stealing/defrauding/etc. you would have to pay restitution and additional fines/time in prison. This is how it should work for businesses to. If the goal is to actually prevent future abuse.
You would have to record every single conversation to pin intent on specific individuals. This is one big advantage of being concentrated in cities, you can meet face to face with people and discuss things without fear of legal repercussions.
That wasn't my point. I'm not talking about assigning blame on individuals in a company but to at least use the same principles when punishing companies as we do with individuals.
A private individual is expected to return all illegal gains, pay additional fines, and possibly do prison.
But a company might be expected to pay fines that are actually a fraction of the profits made abusing the law. This means paying the fine is more lucrative business than ceasing the abusive behavior.
As such the system only gives the appearance that it's working when in reality it's just not bringing the expected benefits. If paying the fine and keep skirting the law is cheaper than fully complying than that's what companies will do.
In return for not having to compete on equal terms in a giant market for years, that seems like a defensible deal for Google even if the fine is large per se.
It's cutting your nose to spite your face. This isn't how business is done. So they would give up tens of billions in revenue per year for a one time comparatively low fine.
If Google packs its bags they'll be the ones feeling most of the pain. And such a drastic move would have consequences on any business Alphabet tries to do in the EU over the next decades.
If anything they're not handing out enough fines. Companies just pay them and keep doing shady business because it's financially more sound to keep abusing the system. Paying the fine is cheaper than correcting their business practices.
The amount of the fine is literally proportional to the revenue that was made using the practices in question. The more money you make by breaking the rules, the bigger the fine. Which part is petty or vindictive?
On the bright side many decisions the EU takes also benefit the rest of the world by virtue of being a big enough market.
Of course you can expect any government to be a little easier on local businesses but as far as correctness goes the EU has always done a pretty good job.
> Can Google just close shop in the EU and ignore the fine?
Sure, if they don't want to get any revenue from the whole European Union anymore. Fortunately the EU is a big enough market so that Google doesn't have any leverage here.
Other commentators are saying the fine is between 1/3 to a half of google’s profits. I sincerely doubt the EU represents more than that share of google’s revenues. But of course I doubt they would pull out as this is a one time thing.
Couldn't they still generate revenue from ads and services in Europe? The EU could block Android phones but its not like they are going to build a firewall.
Google's profits are a bit weird right now, thanks to the new us tax law. (I wrote more about that at the end)
Their 2016 profit was $19.4 billion and without the one-time foreign asset charge it would have been $22,4 billion, as such the fine compromises less than 1/4 of googles earnings.
Their European revenue was $22.6 billion out of $90 billion total revenue for 2016.
This makes it look like an incredible high fine. It's important to notice that the revenue in Europe is mostly google ads. The total revenue for alphabet is also bloated by thing stuff like other bet, which produce $400 million revenue and $900 million loss. Or to put it more bluntly, the revenue in Europe has a stronger influence on alphabets profits than the revenue in the USA.
I still think the fine is incredible high, one reason for this might be a lack of commitment from google after they were fined for $2.4 billion last year.
This being the second time google breaks European anti trust laws. In a really short time.
Last year they were fined for what Brusels describe like this in their press released: Since the beginning of each abuse, Google's comparison shopping service has increased its traffic 45-fold in the United Kingdom, 35-fold in Germany, 19-fold in France, 29-fold in the Netherlands, 17-fold in Spain and 14-fold in Italy.
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A bit more on why google earnings are weird:
"For the quarter of 2017 that ended on December 31, 2017, it actually recorded a loss of $3 billion, but that was due to a one-time foreign assets charge due to the recently passed U.S. Tax Cuts and Jobs Act. If that is excluded, Alphabet would have had net income of $6.8 billion, up from $5.3 billion compared to a year ago. "
yearly
"For the entire 2017 fiscal year, Alphabet recorded revenues of $110.8 billion, up from $90 billion in 2016. Net income was $12.6 billion for the 2017 fiscal year, compared to $19.4 billion in revenues in 2016, once again reflecting the one time charge due to the tax law change."
Sure, but Google will even with the fine have made a significant profit in the EU.
Google leaving the EU would be, for the company, like Google leaving the US – firing half their staff, losing half their revenue and profits, etc. Absolutely not worth it.
They could but they'd lose access to the economy with the largest spending power per capita in the world. Inevitably another player would spring up to feed this void and could then use that as a platform to start eating their lunch elsewhere.
Do you imagine the EU would force every ISP to block Google web search, Gmail, etc? Beyond being technically difficult I do not believe the EU currently has the power to create a Great Firewall of Europe like that.
They "could" block all import of Android based smart phones if they wished (based on noncompliance with trade rules of course).
In all liklihood they'd slap a levy on these imports which would either raise their price making alternatives more interesting to the market. Android devices are dominant in the cost sensitive segment.
Alternatively the manufacturers could push this back on to google or it might provide additional commercial impetus to develop a viable alternative.
That's the beauty of one of the largest economies in the world singing in harmony from the same hymn-sheet. When the collective foot is stamped it echoes around the world.
The discussion was about "losing access". To do that the EU would have to impose not just tariffs but complete import bans on dozens or maybe hundreds of OEMs, many of which aren't American. It'd mean starting a phone-oriented trade war with most of the world's big economies, and handing the entire European market to Apple.
But Android is much more popular than Apple phones in some EU countries (not all) mostly because it's a lot cheaper. So either a lot of Europeans would have to fork out a lot more than they wanted to for a phone, or decide they couldn't afford a smartphone at all and go back to feature phones.
This is why you admit the EU would never do this.
When the collective foot is stamped it echoes around the world.
Very Orwellian imagery you have there. It wouldn't really echo around the world. Google wouldn't give a crap. Android was created mostly to stop Apple from gaining a monopoly and holding them over a barrel with respect to services (go read up on the origins of the project). It has wildly succeeded in that mission already. If the EU selectively taxes its own people whenever they buy an Android smartphone, this would not only hurt the EU's own popularity significantly (people love their cheap smartphones), but it wouldn't harm Google much or at all because Apple un-clenched a lot since Jobs died and iOS is a more open platform than it used to be, albeit, still nowhere near as open as Android. The rest of the world is sufficient to keep Apple in check anyway.
Why would the EU do that? The EU demands fines, nothing else. If Google wanted to leave the market to not pay them, it would be their job to geoblock every EU IP from using Google services.
How would it be Googles responsibility? Asking nicely would only get you so far and honestly with GDPR and now this, the EU is becoming more and more of a liability
I would hate to live in such a restrictive area but that is probably more a cultural difference than anything. I'd rather have competition and innovation than security and stability. In my opinion it is the main distinguishing factor between the USA and Europe
All I can think of is Nokia and possibly Vodafone if those count as technology. What other big tech companies are there? Not trying to be rude, just generally curious as I don't know much about the European technology scene
I actually hadn't realised Spotify was Swedish! Deezer is French.
Pretty much every high-end car manufacturer.
ARM.
Did you know the modern three-point tractor hitch was invented by an Irishman? Modern motor cars come from Germany. The Web as I mentioned earlier comes from CERN which is a joint European project.
Ericsson, Siemens, Philips.
Airbus is also another joint European cooperative.
Google's profit center (adsense and all related ad selling) would not exist in europe, and therefore, all europeans would be unable to purchase ad space using google. Unless, a business decides they prefer to circumvent their local laws, and pay google from an overseas account to access advertising services.
However, i suspect if google left europe, another competitor to google (ala, bing?) would immediately swoop in and take all the business. Google would suddenly find itself losing 1/3 or even half of their revenue!
Doesnt make sense, if google didn’t geoblock EU IP addresses how would the EU react? Issue another fine which Google won’t pay?
A similar analogy would be like the US blocking their citizens from traveling to North Korea. But then having direct flights from LA to Pyongyang and expecting North Korea to enforce the ban of US citizens at their customs. It’s not their responsibility..
Parent post's point was that Google should block European users in response to European sanctions. Why would the EU prevent her denizens from using Google's services for free?
To twist your analogy this is basically like the US deciding not to give Pynongyang aid any more, in which case yeah they might just decide to block US immigration.
Losing out on a market place with 22% of the world GDP and ceding it to Amazon, Apple and Microsoft would probably invite at least a little bit of shareholder challenge.
I'm wondering how such a fine actually comes into existence. How does some EU committee get the idea that Google is anti-competitive here? Is this the result of lobbying by competitors? Can we somehow post the EU about instances where companies are being anti-competitive, and get them to take action somehow?
Given the enormous amount of anti-competitive behavior we see every day in the news, I can't help but feel this fine seems a bit arbitrary.
Probably in part yes, but the European Commission is also pretty proactive. E.g. if I remember correctly, they reached out to Mozilla to get their take on how MS was bundling IE with Windows, after Opera originally complained about it. This came out of it: https://www.google.com/search?q=browser+choice+screen&tbm=is...
You don't really need lobbying in order to make Google conspicuous. In particular with their creative approaches to accounting.
> Is this the result of lobbying?
In all likelihood there was almost certainly an element of lobbying, in particular complaints about these business practices which eventually coalesced into some kind of more focused activities.
It seems a bit quixotic to blame "competitors". Which competitors exactly? That's the whole premise of abuse of dominant market position.
You can see the original fact sheet of the investigation here (http://europa.eu/rapid/press-release_MEMO-15-4782_en.htm). The reasoning for the investigation is at the bottom. There were two complaints and an independent investigation by the committee.
The fines "reflect the gravity and duration of the infringement. They are calculated under the framework of a set of Guidelines last revised in 2006." (http://ec.europa.eu/competition/antitrust/procedures_101_en....). There's a link to the guidelines on the page.
Google is debatably the leader of the tech market and mobile is the fastest growing segment, so the term "arbitrary" is not warranted - as in, picking market losers and winners by selective enforcement of the law.
Whenever allocating limited enforcement resources, you would expect the most egregious violators to be targeted first, with immediate social benefits and prompting self-compliance for smaller actors.
I think this is a mistake and essentially punishing Google for pursuing an open distribution model for Android, without which I doubt it would have emerged as a serious competitor to iOS.
We're all a lot better off, even people that use iOS, because there has been real competition in mobile. This is essentially choosing which business models the EU thinks should win.
The punishment is not for pursuing an open source distribution model, but by applying undue power in taking back control of the open distribution model.
But Apple hasn't been fined in the same way. So apparently if Google had kept Android proprietary, and made their own hardware, they'd be totally OK, even though there'd only be two phone makers left in the world instead of dozens like there is now?
I'm sorry but this move is garbage. I am British and I'm so glad the UK is leaving this horrible, success hating farce of a union. Google paid billions to develop Android and then gave it away for free under the Apache license specifically to encourage competition and diversity in the smartphone market. They then added a carrot of some apps and the app store if OEMs agreed not to introduce backwards incompatibilities, to avoid the J2ME problem of a hopelessly forked and buggy platform.
If they hadn't done these things, very likely Apple would have wiped out every competitor in existence.
The EU is sending a powerful message with this move: keep everything proprietary, pick a high enough price point to price out most poor European countries, and you'll be fine. Build an open ecosystem where competitors target every price point and you'll suddenly find yourself being an involuntary contributing member to the EU's budget. What a great disincentive to build products for the Spanish or German markets.
Isn't it great that you're heading for a hard brexit, then? If the competition is no level-playing field anymore, how should a local company be successful?
Your points have been addressed above already, if Apple had a dominant market position, the EU would have handled things differently. And Apple has been fined by the EU before as well.
As Apple fans always rush to point out, Apple owns most of the really profitable users, so if I'm developing a new app or website I have to play by their rules and can only rely on technologies and protocols Apple supports.
Obviously, the EU deciding to terminate all cooperation with the UK because of an ideological "all or nothing" approach is a tyrannical and cult-like way to run international relations.
However if the alternative is having to deal with the EU Commission then yep, I guess hard brexit is the next best alternative.
The reason the EU doesn't have any local mobile companies isn't do to with Android or Google's licensing terms. The EU had a very successful mobile firm and it shot itself in the foot over and over so badly it disappeared, because its own competitor(s) to Android just weren't good enough. Nokia was hopelessly out-engineered by Silicon Valley and in hindsight it would have done better to admit that, and become an Android OEM itself. It wouldn't have had to cut any deal with Google. It already had Ovi Maps and its own app store infrastructure. It could have done an Amazon and adopted Android without any strings attached.
Well it's hard to say that because the EU is the wrong way to organise European cooperation from the start. European cooperation should be done the way it used to be, as many multi-lateral agreements and organisations that are only loosely affiliated or not at all.
But most of the European political elite want to unite the continent under a single government instead. Given that, the best kind of Brexit would be one where the UK is no longer a part of this, and can sign various unlinked bilateral treaties to continue cooperation in the areas where there is agreement, and discontinue in areas where there are disagreement.
This makes perfect sense - agreement on everything is rarely possible, so collaboration on the areas where people do agree is the best you can do. It's also exactly what the UK has proposed repeatedly. However the EU refuses to allow it, exactly because if people were offered that alternative the EU and associated gravy train would cease to exist tomorrow.
Well, I personally am in favour of the way the EU acts as a permanent umbrella to organise cooperation and according to the latest polls, the majority of people in most countries are in favour of that too. Otherwise, with each country acting on its own, they would be picked apart by the much larger players, the US, China and Russia.
Maybe the UK media points a wrong picture of the mood in the EU, but I seriously doubt that it would cease to exist if your alternative would be put forward. But that's something all Brexiteers tell themselves repeatedly, over and over, like a mantra.
I'm sure it would cease to exist. The EU has lost every referendum on further integration held in, what, the last 15 years? The EU political elites are notorious for telling countries that voted wrong to vote again, or just ignoring them.
If every population that's asked rejects the EU's vision what on earth makes you so sure that a comprehensive alternative wouldn't be popular?
Also there's no such thing as "picked apart" in the sense you mean, i.e. outside of military strategy. Nobody is picking North Korea apart despite that it's a world pariah. If a country doesn't want to collaborate with another country or accept its terms, it doesn't have to - the idea that cooperation is a form of warfare is exactly the mentality that the EU has, and is why it's so desperately dangerous and problematic as an organisation.
> However if the alternative is having to deal with the EU Commission then yep, I guess hard brexit is the next best alternative.
They're currently headed towards not really exiting the EU. Once they looked into the details they determined that the drawbacks were outright lies (350M GBP/week) and the benefits are huge. It might even end up as a paper exercise.
The fact that Android was open source was a huge factor in increasing adoption and obliterating the other competition (like Symbian, Windows, etc). It's a competitive advantage, not a kind hearted choice.
When Android was launched is was just another unknown piece of software, poor performance, lack of features, etc.
They can't both reap the profits of open source and then reject any disadvantages (such as with their anti-fragmentation clause).
They have the option at any point to go closed source and face the huge shitstorm that will follow.
>if Google had kept Android proprietary, and made their own hardware, they'd be totally OK
Yes, why is that surprising ? They would also not get the benefit of OEMs shipping their bundle of services across the globe.
>gave it away for free under the Apache license specifically to encourage competition
It has nothing to do with increasing competition. It's anything but. That's one of the reasons for the fine. The non compete clause prevents OEMs from creating forks of Android.
No, you're completely wrong. Have you even ever used Android devices? Samsung's flavour of Android is quite different to HTCs or LGs. Google doesn't prevent people creating competing forks of Android, that's the entire point of Android's design.
What their agreements require is that the forks be compatible with base Android, that is, apps should run the same on every variant of Android. It's designed to ensure app compatibility and avoid the mistakes of the past, like with J2ME where apps had to be debugged on every single phone because they were all riddled with bugs and incompatibilities.
But outside of app compatibility issues vendors can and do make big changes, everything from the appearance to the UI to the set of bundled apps - Samsung for instance replaces the browser, replaces the calendar, replaces the contacts app, replaces the home screen, replaces nearly everything. And Samsung is a Google licensee. So clearly, your understanding of what Google is doing here is not accurate.
>Google doesn't prevent people creating competing forks of Android, that's the entire point of Android's design.
Did you read the main points of the press release ? If you (say an OEM like LG) license google play, you cannot create a competing OS based on AOSP. It has nothing to do with OEMs customizing AOSP for the devices they sell. It has everything to do with, say, an OEM selling a different phone that can run Amazon's version of Android with Amazon's services. I think that's one of the reason's why Amazon's phone never caught on. Nobody other than Amazon would be able to make or sell one because everyone had licences from Google.
From the press release:
"Google has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks")."
The press release is wrong, who'd have guessed. What is Samsung TouchWiz or whatever they call it these days, if not a competing OS based on AOSP. Ditto for every other Android device. Android was forked so much that for the longest time the lament of geeks everywhere was "give me a device with stock Google Android". That doesn't sound like an monopoly to me.
Apple doesn't try to tap markets that doesn't own and to force their own ecosystem into those markets. Google does. That's the fundamental difference.
It is okay for them to do whatever they want with their Nexus/Pixel devices, since they fully own them. But forcing some random DTV vendor to install Google Search, Google Social Network, Google Online Shop, Google Payment System, Google This and Google That, just because the vendor chose to adopt a free operative system into their system, it's just abuse of power and monopoly.
It automatically gives Google an advantage over the Search, Online Shop, Social Network, etc, markets. It is basically impossible to start a new video streaming business in the DTV market, for example, when you know that every single DTV system has Youtube already installed just because Google mandates so. And Youtube is "good enough" for 90% of the people.
The entire world doesn't suddenly owe something to Google just because they made something open source.
What's Apple Maps then, if not "trying to tap markets they don't own and to force their own ecosystem into those markets"?
Apple tied together iOS and their own apps for a long time. Although Google provided the map data, the maps app on iOS was Apple's and for the longest time they banned anyone from writing competitors to it (ditto for music apps etc). They now pre-install their own maps app and prevent competing apps from actually becoming the default.
Your second paragraph is just wrong. Nobody is forced to use the Google apps. They're sold as a bundle and you can use Android without buying them. That's what it means for Android to be open source. Google can't "force" third party firms to do anything, especially not TV vendors where apps hardly matter.
Your third paragraph is also wildly wrong - how can it be impossible to start a new video streaming business when just yesterday there was a big discussion here on Hacker News about the stall in growth of Netflix and how their content library is poor because content providers are all setting up their own streaming services? There are lots of video streaming services around today and more are being created all the time. There's even one in France (dailymotion).
Thanks to Google they can even create apps for their services and it's easy for those apps to be installed on new smart TVs. YouTube is hardly the only streaming service, I routinely watch Netflix and watch shows I bought off iTunes.
The entire world doesn't suddenly owe something to Google just because they made something open source.
What a horrible attitude. Google doesn't owe the world open source code either. It's a gift. You might decide you don't like that gift, but the code is Apache licensed. It literally comes with no strings attached. You can do what you want with it.
But the fact that you feel it's impossible to set up something as basic as a video streaming service says a lot about the European mentality, to be blunt. I see America setting up video streaming services left right and center. There's Hulu, HBO Now, Disney's new service, Vimeo, Facebook and Twitter have integrated services. It isn't impossible. What you mean is it's easier to let other people do the work and then demand they pay big fines than to set up a company and compete.
Google is in fact forcing all device manufacturers to use Gapps and do many other things or else lose access to all the features that make Android be Android. Companies like Sony, Samsung, HTC are only allowed to ship official Android devices if they want to continue to be able to do mobile-related business with Google.
For instance if Philips wanted to ship an Android TV without spyware, they would have to remove some Google apps => anti-fragmentation clause kicks in => Philips isn't allowed to sell official Android devices any more.
But they can continue to sell Philips-Android devices which nobody would want because they're missing critical features which would be disabled by Google shutting down their official Android access.
So actually Google has Philips by the balls, even if Android is open source. The EU doesn't like that.
it seems likely that if Android wasn't "free" it would not have gained almost 100% of the market share in licensable mobile OSs, so there would still be the same amount of phone makers, but with more OS fragmentation.
This one frustrated me to read, i think they should have gotten involved sooner and worked with google. Instead they slap a crazy high fee for something that is vague in violation. It does feel a bit like a vendetta here by the EU.
I kind of felt the same about the Apple Tax / Irish Revenue Commissioners thing.
On looking into the judgement however it appeared as though both parties actively sought to subvert competition rules under a disingenuous "veil of ignorance". Warning shots had been fired earlier but the practices continued hence the fine.
I haven't read into the details of this judgement yet but you may well find similar reasoning therein.
That's not a fine against Apple, it's a demand that Ireland corrects past behaviour that has been deemed state aid.
While it's certainly Apple's prerogative to play EU states off against each other to get the best deal, it should have been blindingly obvious that what it was getting from Ireland would be, and should be reversed.
The EU's demand was that Ireland collect that tax from Apple.
And blindingly obvious to Apple, the benefactor.
When somebody says, "Hey come and do your stuff here, we'll only charge you 0.005% corp tax!" you should expect that their wider financial governing body (who is losing out severely because of a deal like that) might have something to say about it.
You think it was blindingly obvious to Apple that they would have had to pay this tax eventually? Seems to me and everyone else it was an attempt at a stroke. You're alleging that Apple were a passive actor.
You saw that thing in the ICIJ Jersey papers leak where Apple went round the world actively seeking jurisdictions that would twist their tax rules to suit them?
No, I'm not alleging Apple was passive here, at all
I'm saying that when you get a deal this good —however you ended up there— you should not be surprised when it turns out that it was illegal.
Of course Apple shopped around. But if somebody offered to sell you $20 bills for half a cent each, would you suspect something dodgy? That's the scale of the issue here.
This is just a drop in the ocean for the total amount of wealth that is protected with these schemes. In the $20 for ¢0.5 picture this probably amounts to ¢50. They're still making off with the other $19.49. Though arbitration would probably round that up.
Apple should be forced to pay back 10x what they gained in this illegal deal.
It's bleedingly obvious that it's illegal to be taxed differently than other companies. Paying back €13bn is nothing.
Companies that "make deals" on tax anywhere in the world should be effectively banned from the EU market. It's pure evil. Or pay 10x of any gain they have made anywhere in the world by "making deals" on tax, thereby undercutting fair competition in a free market.
It's bleedin' blindingly obvious that this is all a matter of corporate strategy. Yeah they should be fined for sure, but as many are keen to point out they keep to the letter of the law. That's not to say the EC couldn't enact some kind of retroactive legislation but that wouldn't be likely as they have their own "special interests" to look after too ...
Playing states against each other is par for the course in the US. Each state can offer wildly different tax structures and incentives, and they all do, because each wants to be the state government that oversaw "6000 new jobs". They've seen similar issues with the collection of sales tax, when one company can "operate" over many state lines.
But saying "hey, that's obviously corruption" isn't enough. We need a good way to restructure tax collection so that the right people get it.
Multinationals paying Luxembourg (Paypal, eBay) or Ireland (Apple, Amazon) for all revenue and operations from the entire EU is wrong, no? How do you fix that?
There is literally a "world" of difference between a collection of trade-aligned sovereign nations, and a single nation of autonomous economic regions. As you mention, it's an accepted part of daily business in the US but everybody pays taxes to the Fed at the end of the day. All governed by the same congress, president, and a coherent political dialogue throughout. That's not to say it'll always remain so.
The particular problem with the EU is that it's a system of "good faith" agreements that has until quite recently been quite weak against cynical attacks.
This kind of dealing undermines the spirit of the EU accords and you can expect it to be dealt with in the course of time - probably through tax harmonisation, which wouldn't then be a million miles away from the american model.
Though tax avoidance was a corporate strategy and they actually sought these deals it would not have been obvious that this was technically illegal. The Irish Revenue Commissioners told them it was legal as an interpretation of Irish law, which was incorrect.
> While it's certainly Apple's prerogative to play EU states off against each other to get the best deal
It certainly IS NOT. When Apple "get's a deal" it is by definition market manipulation. You're not supposed to "get a deal" regarding taxation!
The same taxation rules must apply to every company or else there is illegal subsidy. The whole idea around "making a deal" on tax is horrendous anti-capitalist BS.
It's exactly the same as "making a deal" wrt the law in a corrupt country. A corporation "making a deal" by having government look away when they do something illegal, or getting their competitors fined on dubious charges.
Apple, Google, Microsoft, and basically all of those companies ARE THE SCUM OF THE EARTH for not refusing do to business with the market-corrupting Irish Republic.
In most (all?) other fields of law you are expected to abide by the rules as they are stated, or risk being punished by the legislative powers. That's not a vendetta, that's law as it is most commonly practiced.
I don't see why EU should "work with google" to make them follow regulations (EDIT: beyond the threat of punishment).
The problem is that antitrust laws like these are very selectively enforced. Selection and prosecution of these cases is hence inherently political as these are non-standardized arguments or verdicts.
I'm guessing that they did, and probably came to the conclusion that they'll make more money than the fine that gets imposed. I wonder if they were right?
That is a fair point, but isn't it built into this particular field?
We can prosecute equally for jaywalking, but anti-competitive behavior gets worse the bigger the offender is and/or the worse offense they commit. So in that way it makes sense to prosecute "top-down", that is go after the biggest ones first.
That's at least what I prefer as an EU member state citizen and consumer.
Not only does it get worse the bigger the offender is; in law, generally there are specific actions that you're not allowed to take iff you're dominant in the market.
> The problem is that antitrust laws like these are very selectively enforced. Selection and prosecution of these cases is hence inherently political as these are non-standardized arguments or verdicts.
Following that logic, the same applies to law in general. Should we therefore abolish law?
The ones I know about have all been the result of a complaint made by competitors. I would be surprised if the regulator could selectively reject such complaints without good reason.
The law may be the law but you still need someone to complain to the authorities.
If I went out into the street and 'keyed' someone's status symbol car then I would not be in trouble until someone decided to do something about the crime.
The owner might not be pleased and, pressured by the insurance company, might get the police to go through CCTV and finally find me caught in the act.
Alternatively, a neighbour or passer by might just call the cops on me whilst I 'brazenly commit the deed'.
Either way, unless there is a report of wrong-doing then I would be getting away with it, not having to be fined etc. The police don't just sit there idly looking through the rule book looking what they can nick me for, someone would have to bring matters to their attention.
And that is the problem with this EU ruling. Nobody I know has bought a phone, decided to write to their MP (or MEP) and complained about not having Bing! as their default search engine. The EU don't accept complaints from little people like that anyway.
So what has gone on here is that some group of lobbyists have sought out some money from the Microsofts of this world, invariably to setup some fake pressure group, to bring on this legal action. With previous history, e.g. bundling in Windows, the modus operandi was the same, albeit with Netscape being the whinging ninnys.
Whwn the story finally hits the press the parasitical legal firm, the fake consumer group and who fronted the cash to pay for the action get forgotten, instead debate concerns whether the E.U. is a load of rubbish, being as silly as when they banned bent bananas and had wine lakes or whether Google have been truly evil.
In The Emperors New Clothes the people that sold the expensive invisible thread leave the story so in the final act there is just the stupidity of the crowd and the stupidity of the Emperor, story facilitated by the boy. Similarly here, the people that have wreaked this carnage have left the story a long time ago.
> i think they should have gotten involved sooner and worked with google.
You are assuming that Google is a poor layman that is accidentally breaking laws. Indeed Google has an army of lawyers and they know precisely well the risk of their actions.
According to the article they tried to work with google on this for 2 years, and it’s still not a final decision - google can appeal.
Although, they should have put a fine of $12b (all of googles yearly earnings), effective immediate, and double it every year until non competitive practices ended.
This line in the article got to me, "The fine would top the EU’s €2.4 billion antitrust decision against Google just over a year ago."
It looks like the EU has created a piggy bank with these regulations on hostage tech corporations. I wonder how much of the large fines is attributed to prosecutors or politicians trying to make a name for themselves.
Anyone know how often these record fines hold up on appeal?
Edit:
Wow, lots of people triggered by this comment. Must be because it's between 4AM and 7AM in the US while being the afternoon in most of Europe.
I stand by everything I said. EU regulators shouldn't be able to entitle themsleves to around 40% of Google's yearly profits. If the laws in the EU intended for this then they are backwards and harmful to innovation. That 5 billion dollars could go into life sciences, self driving cars, and a bunch of other stuff that materially improves society. Instead it's going into EU coffers.
Google's services add massive value to the world while regulators have done nothing. Fines on Google by the EU total over 7 billion dollars over the last couple of years. Ridiculous, and I'm surprised y'all are trying to justify this cash grab.
There is a consistent theme of American companies breaking European law and getting fined for it going back decades. The EU has a different legal system and you don't just get fined it happens after a long process of attempting to correct behaviour and legal proceedings.
The arrogance of Americans to believe their legal system applies everywhere and that any attempts to apply a different one constitutes an attempt to raid the piggy bank is kind of amazing. I wish it wasn't such a prevalent view but you see comments like the one you responded to every single time a fine is levied.
Show me the evidence that Google was warned about this practice and refused to stop for a long time. I have a really hard time believing that they wouldn't take action in response to warnings if they knew that 40% of yearly profit was at stake.
How the hell can the EU entitle itself to 40% of the profit of a company that provides a massive value add to the world? Email, search, maps, video, cloud, office apps and so much more.
I don't think Americans are the arrogant ones here, with the EU levying multi-billion dollar fines on a yearly basis.
This is not evidence, charges were issued years ago based on past behavior. Until there is a decision made, why should Google change it's behavior?
My view on this situation is that regulators should decide if such bundling is allowed on a case by case basis. Then, the ruling is 'We have made a decision. You get X fine if you do not comply.' Rather than, 'We prosecutors think you are not complying' followed by 'Yep you were not complying, give us billions'.
So, if you're caught parking in a handicapped spot, do you also expect a note asking you nicely to stop doing that in the future before getting a fine?
The last fine google got was 10% of their income, last year. This year they aren't playing by the rules again. What is the EU supposed to do? Give another 10% fine that will be ignored? Also the fine is not 40% of googles income. The corrected income this year is $22.4 billion USD. $5 billion is less than a quarter of that. Going from 10% to 20-25% seems totally okay, if google does not try to follow european law.
(The 2017 income of google is lower because they decided to use the new US tax law in order to move a lot of money to the USA which cost them $9.8 billion. But you can't say your income is low just because you spend it all on ice cream. This is why I use the adjusted number of $22.4 billion)
Oh, you'll love it when you finishing reading the article and read the bit about what happens if Google don't actually stop doing this in the next 90 days.
I am not claiming that the law was unjustly carried out. Google must have had the chance to plead their case.
The question is rather, "Should this law exist?" The answer is no. A law which allows this magnitude of a fine for the behavior described is ridiculous.
These are not laws sent down by god. Some elected or not elected officials sat down and decided on some stuff - and they can make mistakes. Have you seen the US congress questioning Zuckerberg and the elementary level of the questions asked? These are the EU analogs, making laws (probably not as incompetent though).
> A law which allows this magnitude of a fine for the behavior described is ridiculous.
It's a percentage of their yearly revenue (or income, not sure). If a company breaks the law and you want it to stop doing that and change their behaviour, you need to be able to hand them a fine that makes them stop and think. Would you prefer if they were handed a $100 fine instead? What would be an appropriate fine for you? I think a moderately high percentage-based fine is the only way you can do this.
The EU has laws. Some of these are different to those in the US, not just in wording, but in aim. There's definitely a much stronger drive to protect consumers from companies exploiting them through data and market abuse, wherever those companies are.
How is Google holding consumers hostage and not Apple?
Honestly, for the value that Android gives phone manufacturers I am surprised that Google's requirements were so low. Android gave the phone manufacturers a platform and asked for little in return.
>How is Google holding consumers hostage and not Apple?
It does not matter what Apple is doing this is about Google.
I would expect that there are ongoing investigations against Apples practices regarding similar issues too.
>Honestly, for the value that Android gives phone manufacturers I am surprised that Google's requirements were so low. Android gave the phone manufacturers a platform and asked for little in return.
Not being allowed to release competing OSes / forks and other software is more than a "little" in return. Google does not give android away "for free" because they want to help others they do it because they want to help themself get into everybodies smartphone.
Regarding "personal branding": most people in the EU doesn't even know the name of the 1-3 top ranking officials in the EU. So while there might be all kinds of personal reasons for this (I can't possibly rule that out), public appeal as I perceive it from the USA it not a factor AT ALL.
Most members in the EU also completely lacks the "personal branding" of judges, they usually aren't elected and politics and law intertwine less so in EU than in USA (again, as I understand USA).
The EU is not using Google or any other company as a piggy bank. Google is doing business in the European Union making tens of billions of dollars and they should follow the rules, just like their European, American and Asian competitors.
It's not like you have to be a legal genius to know the rules. They are right in the treaty (think of it as the EU constitution) and Google know about the many previous cases interpreting the rules that share similarity with theirs, including Microsoft's case about bundling Explorer with Windows and making it the default browser.
So Google and their hundreds of lawyers are well aware of the rules against abusing dominant position. Nevertheless, they have chosen to ignore the rules - maybe because they stood to gain so much money on breaking the rules.
When Google does business in Europe, they make use of European laws such as the trademark rights that grant them exclusivity to the brand "google", the copyright that grant them exclusivity to their source code, patent rights that grant them exclusivity to their many inventions, and hundreds of other laws that ensure that Google - just like European counterparts - can rely on the rule of law to protect them while they make money. Google itself has likely benefited tremendously from the exact same European competition law, that they are now fined for breaking. Were it not for such laws, Microsoft or Apple could and would likely have toppled Google from the advertisement market simply by forcing their own search engines, browser, maps, emails etc. on users of their operating systems.
Whether the administrative decision of the European commission to fine Google will hold up in court will be seen if Google decides not to accept the fine. So far the European Commission has had a good track record.
Harmful to innovation laws absolutely crushed innovation in Europe. I'm guessing this is one of the few ways they can get any revenue from innovation anymore
History is repeating itself. Only difference is that Google search and Chrome browser is not as bad as MSN and IE in former times. Why Google did not looked on how MS handled that issue when you become the market leader?
I somehow doubt it pays more than 5 billion dollars. I mean, even when I had the option I would use Google search and Google Chrome anyway and I think many other people too.
People use defaults. Look up UC Browser and the Samsung Browser. Especially their market share.
Regarding potential gains, Android has all but cemented its position as the smartphone OS. Microsoft did the same in 1995 with Windows in the desktop market and it has 90%+ marketshare there, 23 years later. It's very likely it will still dominate the desktop market in 2045.
Android will be at least a loss leader for Google for decades to come. And they made $10 billion in profit in 2017 alone (of course not all of it is driven by Android, but you get an impression of the scale).
Very slightly off topic but I actually think how Android handles default apps is the best of both worlds. It comes with very very good default Google Apps that work well together but it is very easy to switch out whatever you want for an alternative. How iOS handles it is the opposite. For their default apps they either straight out not allow competitors, severely limit what their competitors or (if I remember correctly) they even removed apps when a newer iOS added Apple's own version so they were now "competing".
I know that anti-trust laws are probably not applicable as Apple does have a dominant position based on total market share, but to me this practice seems far more anti-competitive. Banning competitors seems worse than fully allowing competitors but providing your own as default that can easily be changed.
Could you please tell me how I can uninstall the default apps, or at least keep them from constantly updating themselves? That half a gig of unwanted apps that just keeps growing itself is pretty annoying.
True, that bit is a bit annoying, but again, not being able to switch out or uninstall default apps is much worse than just not being able to uninstall default apps.
Default apps are often built-in and can't be uninstalled. But you can disable them. See https://support.google.com/googleplay/answer/2521768 for details. If you do this then it's worth uninstalling any updates to the app first, to free-up some space.
In settings go to apps, select the app you wish to stop updating and then select disable. All updates to the app will be removed and the app will no longer update.
Do you have a source for this? I can’t remember Apple disallowing an app because Apple itself provides a similar app. I checked the default apps quickly on my phone, and can find several competitors for all of them. If you are talking about the "apps" Messages.app or Phone.app then I guess you might be right if we define "not providing a public API" the same as "disallowing on the App Store".
You can’t choose what happens is the default on an iPhone. If I want to use Gmail to open mailto links I cannot. If I want to use chrome to open web links by default, I cannot.
On Android you can pick whatever apps you want as the default.
I might have misunderstood what theBobBob meant with "default apps" completely, but that was not how I understood it at all. As far as I understand, he talks about disallowing apps on the App Store, so this would be a completely different point (to which I agree, setting a different browser would be nice).
They don’t allow apps that have similar functionality as well. On my phone, but when AirPods came out they pulled an app that helped you find your AirPods from the store because they included their own version of the same tool in an update
The policy no longer applies but for a long time, from the start of the app store, you weren't allowed to make apps that "duplicated the functionality" of the built in apps.
Notably Google made their own maps app and Apple banned it:
That's a good reason why fines (like what Google is getting) should be huge.
It's deliberate to kill competition while not being in a dominant position, and then when in a dominant position, continue the trajectory by defining defaults.
The Apple apps are dominant partially because of the abusive rules the app store had earlier. It's quite clear from the fact that in any area where Apple did not have a default app, they are unable to match what the free market offers.
> I know that anti-trust laws are probably not applicable as Apple does have a dominant position based on total market share
It's an interesting question though, because it depends on which 'market' you're talking about. This is a vexed question in antitrust law [1]. There is some pending litigation in the United States as to whether Apple illegally monopolized the market for iPhone apps [2], but it's been brought by app purchasers rather than the regulator, and Apple has taken the case to the Supreme Court to argue that the purchasers don't have standing to sue.
It would be perverse if the court ordered Apple to modify iOS to support third-party app-stores. I see it as the same situation as video game console licensing: all games for the Xbox, PS and Nintendo must be approved by the platform owner and they take a cut from all sales.
The "happy medium" we have today: where jailbreaking was found to be not illegal, works for as long as we can jailbreak. I note that iOS does now allow sideloaded apps too, though they still must run in the sandbox, but it does mean you can distribute an app that wouldn't be approved for the App Store.
The EU had another workaround: impose a higher import tariff on video game consoles than general-purpose computers. Sony released a Linux kit for the PS2 so they could say the PS2 was a general-purpose computer, not a console. I think it worked initially but because hardly anyone bought the Linux kit (it wasn't sold at retail with the console) the customs people took a look and Sony had to start paying higher tariffs.
> but it is very easy to switch out whatever you want for an alternative
Do tell how one could switch out the map from Google Maps to anything else (Bing, OpenStreetMap, whatever).
Or how I could get rid of Google+ without needing to wipe my device or use a zero-day.
Or perhaps how I could get apk files from their repository without agreeing to the Google TOS and privacy policy, and without using some hacky system like Yalp store that breaks every couple of weeks for a little while.
This is definitely not easy to swap out. I bet that even from the top 10% of tech-savvy people on hacker news, there's 9%. that cannot figure out how to remove google completely within a normal working day of 8 hours.
The OP was talking about built-in Android support for changing defaults using intents. It's a pop-up menu, and is pretty easy to understand even for non-HN users.
You switch out the map app like this, same way you change the default app for anything else: https://360.here.com/2015/01/29/swap-google-maps-here-androi... (The instructions for switching to, say, Google's own Waze app are pretty much the same too.) This is as I understand it not possible on Apple's iOS; even if you install a third-party mapping application, everything else on the system which opens up a map will still use Apple's map.
That's a location picker. I'm talking about the map view on which applications show you things, such as live views of all trains in the country or something.
And this is just one example, there are a hundred more things that are in the proprietary google suite, without which you'll be able to install only a few of the apps available for the platform.
Hmm, those are the specific apps using Google Maps API. That's like saying why does HackerNews use jQuery, I want it to use lodash. (I don't know if they do, just an example).
Don't they just call the default maps sdk, whatever implementation it is? Because if I firewall google play services and some other google stuff, but not the app that uses it, then everything will work but the map isn't displayed. It's google play services that does the map loading, not the app, it seems.
> Doesn't that apply to almost any software with a license?
But Android claims be FOSS. I understand that "using google servers" != "the AOSP project", but there's a large number of apps whose only publication channel is this ubiquitous play store, because the devs know that practically everyone who has Android will opt into the google kingdom as well. If it was closed source like iOS and if you can't even sideload apks (or ipas or whatever they are) then I'd not be surprised that I have to agree to some near-monopoly's TOS and privpolicy in order to get access to 99% of the published apps.
I've noticed that on iOS, Google can be quite pushy with regards to their apps. No matter how many times I click "don't ask me again", Hangouts always asks if I want to install Chrome whenever I try to open a web link (in Safari). And I get constant nags on Gmail web to install Gmail on my iPhone to "get the full experience" (as opposed to using the bundled iOS Mail app).
Fragment of wikipedia about politics absolutism: According to some political theorists, complete obedience to a single will is necessary to maintain order and security. Android is more secure and ordered the way it is, but in the long term absolutism is a way of slavery and we need the opportuntiy of change and improvement, not slavery.
So, according to the EU, it is illegal to open source OS components (thus allowing anyone to use it without further input from Google as long as the license is followed), but then close source other components and the services that drive them, although they are given out for free, but require specific licensing in the contract to distribute said free closed source components and services on their OEM devices, of which the sale of said devices does not earn Google money as they are provided to OEMs and users for free?
In addition, said closed source components and services are merely defaults, and you can install anything you want?
Example: Bing Search, Cortana with full Android Assistant support, Microsoft Launcher (which has full Bing and Cortana support, just like Pixel Launcher has for Google), and Microsoft Edge.
Further Example: TouchWiz, Bixby, Samsung Browser, Samsung App Store, Samsung Pay, Samsung Everything. If there is an AOSP/Google app, Samsung has probably replaced it with a custom app that is not based on the AOSP/Google version and has generally ruined their phones with them.
I guess the EU has to fine Microsoft and Samsung too, since they also give away closed source OS components for Android, and they can only be used with Microsoft and Samsung services... even though it is optional to use them and can be replaced with something else.
I guess the EU has to fine Apple too, since they do not allow third party components at all, all the way from third party app stores, third party browsers, or anything deemed "overlaps with functionality in iOS (retroactively as well)".
I did. They tried to make an argument that Google forbids Android OEMs from shipping Google Play on Android without also shipping Google Search, and they can only opt in all of their devices, not only specific ones.
In the form I stated, this is true, to get Play you must ship Google Search, and must do so on all of your devices.
What is not true, but implied by the EU ruling is that, a) Android (as defined as purely AOSP) is incomplete and unusable without Google apps, b) that other app stores do not exist for Android, c) that other search engines somehow magically don't work on Android.
None of those are true. I find it unfortunate that Android does not have higher profile alternative options, but no one else seems to want to put as much effort into their products as much as Google has.
Google's actions simply do not meet any reasonable definition of being a monopoly. Google's only action is requiring the entire Google Apps suite shipped on a device as an all-or-none license, it does not require the end user to use them, it does not prohibit the end user from installing others or disabling built in apps, it does not require signing into a Google account to use the device, it does not prevent APK sideloading.
And, until recently, Google was not even a phone OEM (and arguably still isn't, as they do not build their Pixels, HTC and LG do), and Pixels are not nearly as popular as Samsung Galaxy S series (which are famous for "ruining" the Android experience by using tons of custom Samsung apps), and LG G and V series, and Motorola phones dominating the mid-tier segment, and China and India being largely Xiamoi, Huawei, and BBK (Oppo, OnePlus, and Vivo).
Worldwide, Samsung and BBK are the #1 and #2 phone manufacturers, and they merely use Android as their OS. At what point did the EU have the authority to say Google had a monopoly when they do not sell Android phones in any reasonable capacity.
The absence of competition is a sign a free market is not working as intended. The rules and benefits of free markets ceases to apply. A monopoly is a market failure and requires intervention.
Free market advocates are always talking about regulations and the need for free markets but don't seem to care so much about monopolies, outsize profits, the accumulation of market power and its abuse that further impedes the operation of free markets and the billionaires that result.
Google is a serial offender at this point and we are not even into GDPR territory. It seems these fines might actually be too low if they can't keep Google's hands off the cookie jar.
I think Google gave away too much control with Android. By making it open source they let OEMs fork it and make worse versions. Apple exerts much more control and consumers appreciate it. Google controls the Google Pixel and it's considered a real competitor to the iPhone (in terms of user experience).
974 comments
[ 3.2 ms ] story [ 384 ms ] threadIt seems to be a rehash of the issue that Microsoft faced when it only gave you Internet Explorer on install. But iOS comes with only Safari on install, and forces you to use Apple's various apps - how is this any different?
It's not. Be Patient.
It gets much worse depending on the country:
http://gs.statcounter.com/os-market-share/mobile/italy
http://gs.statcounter.com/os-market-share/mobile/spain
http://europa.eu/rapid/press-release_IP-16-1492_en.htm (fifth paragraph)
But for this case, they are using a definition that makes Android even more dominant: they allege that Google restricts device manufacturers' freedoms. And from a device manufacturer point of view, Android has a 90+% market share of "licensable smart mobile operating systems", with "licensable" being key: as a device manufacturer, you cannot use iOS, so that doesn't count if you buy into this line of argument:
http://europa.eu/rapid/press-release_MEMO-16-1484_en.htm
In particular, the EU alleges that if you want to install Google Play on your phones, you need to sign a license agreement which also forces you to: a) install Google Chrome; b) make Google Search the default search engine; and c) not sell phones with Android forks at the same time ("Anti-Fragmentation Agreement").
They want to force Google to allow manufacturers to more freely chose which apps to pre-install and also to be able to offer Android forks in parallel to "Google-finish" Android.
I'm not sure if this will really be good for consumers... I would argue that most smartphones have too much crapware on them, not too little. On the other hand, the Microsoft Internet Explorer unbundling case arguably helped fuel the success of Firefox in breaking the IE dominance, which I would argue was good for consumers.
These alternatives mostly suck but "your competitors suck" is not grounds for an anti-trust violation. No phone vendor is forced to deal with Google, that's an absurd distortion of the facts. Even if they feel their own in-house engineering abilities are so weak they can't make a better platform than Android, they can still take the open source code and use it as a base, providing their own mapping and app store along the way ... just like Apple do.
These days it feels like most people have given up trying to compete against Apple and Google.
Interesting to note that a quick look on the Firefox OS Wikipedia article has highlighted a bunch of other mobile platforms I'd forgotten.
The up and comer is KaiOS, used on super low-end phones in India. Its a version of the Firefox OS.
https://web.archive.org/web/20180717113254/http://europa.eu/...
[1]: http://gs.statcounter.com/os-market-share/mobile/united-king...
[2]: http://gs.statcounter.com/os-market-share/mobile/liechtenste...
[3]: http://gs.statcounter.com/os-market-share/mobile/monaco
Using your reasoning, Microsoft could never have had a monopoly on Windows because you always could have bought a Mac.
You can't define a monopoly as "your competitors aren't popular" because otherwise it'd be illegal to invent new product categories, as at the start you'd be the only player in the new space. You can't define it that way for another reason: it punishes success.
As the sibling comment rightly says, monopolies are acceptable. But, as the EU clearly point out, a greater onus is put on monopolies to avoid abusing their monopoly power.
The profit isn't from the direct sale of an Android device, it's from the system the device is a gateway to.
Like, own all cinemas in a country but home-viewing keeps profit low, so now it's fine to only allow people to visit your cinemas if they buy clothes from your clothing company?
Edit:perfect->problem
There are.other mobile OSes available as well. I'm sure Microsoft will gladly let you use their OS for the right price, KaiOS, Ubuntu phone OS could be resurrected, you could role your own, I'm sure Symbian is for sale somewhere, how about Meego.
If you want to have Google apps on your phone you can't sell any forked android version.
> Nevertheless, the Commission investigated to what extent competition for end users (downstream), in particular between Apple and Android devices, could indirectly constrain Google's market power for the licensing of Android to device manufacturers (upstream). The Commission found that this competition does not sufficiently constrain Google upstream for a number of reasons, including:
They are not punished for their behavior in the downstream market (in which they barely participate). They are punished for their behavior in the upstream market. We consumers do not participate in the upstream market.
Nevertheless, the EU commission considered whether the lack of a monopoly in the downstream market ameliorated the monopoly effects in the upstream market and found it did not.
http://europa.eu/rapid/press-release_IP-18-4581_en.htm
- has required manufacturers to pre-install the Google Search app and browser app (Chrome), as a condition for licensing Google's app store (the Play Store);
- made payments to certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices; and
- has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks").
> Market dominance is, as such, not illegal under EU antitrust rules. However, dominant companies have a special responsibility not to abuse their powerful market position by restricting competition, either in the market where they are dominant or in separate markets.
> Google has engaged in three separate types of practices, which all had the aim of cementing Google's dominant position in general internet search.
If you don’t have a monopoly and do things your partners/competitors don’t like, they can’t complain that you are abusing a dominant market position to get away with it.
There’s nothing wrong with bundling. But when you have a monopoly on the market bundling suddenly is wrong and abusive even if it’s the right thing for your end users.
So we see time and again monopolies are knee-capped in the market and face these absurd fines, in the name of fairness and competition.
I have no doubt that some monopolies leverage their market dominance for some pretty atrocious dealings. I personally see nothing wrong with Google licensing the optional (but extremely popular) Google Play services such that it requires Google Search and Chrome along with it.
If they were unrelated then the experience of Google Play Services would be identical with or without the other pieces (Chrome and Search). I don’t use Android so I can’t say for sure, but I’m quite confident that the overall experience suffers without all three pieces together.
The EU text talks about requiring chrome and search if the play store is installed. As a user of android, I cannot think of any way in which these are linked. I don't see why the play store wouldn't work without those two, or would even lose a single feature.
I suggest reading this:
http://europa.eu/rapid/press-release_IP-18-4581_en.htm
This is the most clearly anti-competitive practice.
Google supports AOSP and has done so for years, making it available freely. Why shouldn't they be able to dictate their own terms? If phone makers don't like it, they can make their own OS (which they have - and they all suck).
> Google has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks").
Hence the fine.
You cannot have something open and control it at the same time.
This might shock you, but not every country in the world believes companies should have free reign to do whatever the fuck they like. It's not like deregulation is a requirement for capitalism.
The real problem here is the minority of Americans who live with their heads firmly up their own arses and don't have any concept of the wider world - of which America is literally only one entity amongst a great many of others. You assume that everyone is envious (which, by the way, is the correct term. "Jealousy" - as you described it in one of your other comments - doesn't refer to possessions) of America when in actual fact we just want American businesses to play by the same rules as European businesses do when those companies do business in Europe. You're not being singled out because we have the same expectation for companies of all nationalities; regardless of the continent they reside. It just so happens that American businesses are some of the worst offenders (possibly due to your culture of anything goes in business?). However as you have also pointed out, European companies do also get penalised when they break the rules too. So you aren't a special case.
But honestly, given the stunts Boeing pulls, your various business lobby groups that affect overseas legislation (eg the breast milk vs formula was), the recent changes to trade relations Trump has made, and all the other numerous indiscretions America make to put their own industries first; you are hardly in the position to take the moral high ground when it comes to international business relations.
> It's not just the administration. Every time the EU has levied fines against Google a lot of Americans on HN claim that the EU is doing it because they're jealous of how successful American businesses are.
> The European Commission has accused Google of abusing its Android market dominance by bundling its search engine and Chrome apps into the operating system. Google has also allegedly blocked phone makers from creating devices that run forked versions of Android.
https://www.theverge.com/2018/7/18/17580694/google-android-e...
> How is it any different
Apple doesn’t have a dominent search engine to push down the throat of device makers.
They also don’t have an iOS consortium nor do work with other makers, so there is no bullying makers into doing what they want “or else”.
As others pointed out Apple is not in a majority position in the first place, but this fine is mainly bound to how the search engine and google suitr services come in the picture, and not on android on its own.
Firstly, Android doesn't have a monopoly. Apple does fine in Europe and their devices can be bought everywhere.
Secondly, there are device makers that didn't cut a deal with Google, notably the Amazon phones and tablets. They weren't that popular with consumers but that's not Google's fault: it just means consumers highly value the additional services Google provides.
It's not hard to become a phone maker these days, judging by the sheer number of Android OEMs that are out there (hundreds, I believe). If there was huge untapped demand for Android sans Google then a new company would appear, they'd download the Android code, they'd go to Shenzen and do a deal with a white label manufacturer, and they'd make such phones. Google wouldn't stop them because they'd be a company that doesn't make any other kinds of phones.
We know this is possible because there's one huge market where that's normal, China. Google's services are blocked in China anyway, so there's no point adding their app store or mapping apps. Local firms produce local versions of Android for their own market and it works fine. We also know this because Amazon tried it and they weren't sued or anything.
There are also open source spins of Android that have custom app stores like F-Droid. A new phone maker could ship those too.
In general, when you see an example that explains a complex issue you should assume that it is significantly simplified and therefore will not be realistic.
It's very normal that a company B would want to go to company A, if A already have a lot of expertise in Android. For instance a POS manufacturer might want to collaborate with Sony or Samsung on an embedded device which uses Android internally (without the GApps & stuff), but Sony and Samsung are forbidden from dealing with B.
Even Amazon would be happy to outsource some Android development to e.g. Samsung but they can't.
However, Sailfish is available only as a post market firmware.
Being a derivative work of AOSP courtesy of libhybris, it would seem Sony are prevented from factory installing Sailfish on any future Xperia device.
No it isn't. But your attempt at refutation is.
> Android doesn't have a monopoly. Apple does fine in Europe
Apple has its segment. Android is pretty much everything else. It is "dominant" in the market.
> Secondly, there are device makers that didn't cut a deal with Google
The complaint relates specifically to access to google play services.
Now go look at who are making phones on this base: Samsung is the most popular but it doesn't have a monopoly.
Is the EU going to fine ARM next for having a monopoly on mobile CPUs?
Maybe? Is there something about their business practices that shapes the market to their benefit? If so, and there are enough complaints then maybe not "next" but yeah.
Have ARM used their dominant position in one market to reduce competition in a different market?
Having a monopoly or being in a dominant position is not the problem. If ARM starts a pizza business and requires everyone who wants to buy mobile CPUs to also order pizzas exclusively from them, then this would be an equally-fineable abuse of a dominant market position and the EU would almost certainly step in.
As it stands, ARM doesn’t force others to buy pizzas exclusively from ARM PIZZA PLACE and hence doesn’t abuse its dominant market position in one market (mobile CPUs) to support its position in another market (pizzas).
Google, on the other hand, uses its dominant position in the "licensable mobile operating systems" market to support its position in the "internet search" and "browsers" market together with anticompetitive behaviour forcing its licensees to exclusively use the Google-approved version of Android.
Most phone makers don't because customers prefer the Google services, but that's not Google's fault. They have provided OEMs with options - options they didn't need to give anyone, apparently, given that non-licensable operating systems like iOS aren't being whacked the same way.
The most Google can do is give away their OS as open source and let people do what they want with it. If they then sell a bundle of extra proprietary stuff on top, stuff that customers want, that can't possibly be more problematic than making everything proprietary.
After all, Apple doesn't even let third party devs from the app store take over the default mapping app: map links always open in Apple Maps regardless of user preference. For the longest time they wouldn't even let apps that competed with their own be developed at all. On Android you can replace the dialer and even the home screen.
I do understand why people are defending the EU here: they like its ideology and vision of the future. But trying to claim Android is some sort of market abuse when Apple's own approach apparently isn't just defies basic logic.
- by preventing manufacturers from selling smart mobile devices running on competing operating systems based on the Android open source code;
- by giving financial incentives to manufacturers and mobile network operators on condition that they exclusively pre-install Google Search on their devices.
a) Android has market share dominances (likely around 75% in Europe in 2018)
b) iOS is not made available for other companies to use
You could make arguments that iOS behaves unfairly to third party developers and end users, and there are some decent arguments to be made there, but none of them are relevant to antitrust law because a) means there is no market dominance to abuse with, and b) means there are no competitors to be abused.
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You said "Most phone makers don't [skip Google services] because customers prefer the Google services, but that's not Google's fault". I think this gets to the heart of the disconnect between your stated position, and the legal reality here (IANAL though).
If Google's services are supreme because of user choice, then Google should require no legal arm-twisting to push those services onto devices.
Instead, what has happened is that Google has over-reached with its Android services contracts (one example - if you want to use Google services on one Android phone, you can't make a second Android phone that uses your own services), and that is what the EU is tackling here.
The different stories people are telling here about why Google is "abusive" don't correlate with the realities of how Android licensing actually works.
Also since when is 75% market dominance? 75% is popular but that's still a quarter of the population successfully choosing an alternative.
Regarding the 75%, please bear in mind that that is across the total market, which covers a very broad range of price points. Apple may have ~25% share, but that is skewed almost entirely to the top end of the market. In the low end of the market, Android would be nearly 100%.
Does anyone know what the contracts contain?
They're using a dominant position in one market to push services in an unrelated market. That's anti-trust 101. And they punish suppliers who don't tow the line.
This is exactly the same as the MS anti-trust case. Swap IE for Google Web Services (Search/Maps/Chrome) and swap Android for Windows.
If ARM started forcing phone companies using their CPUs to only sell to AT&T, that's your analogy. As it is, because ARM don't force unrelated services or products on their customers, it's not analogous.
Note that for the purposes of this ruling, the relevant dominant position isn't in Android, but the Google Play Store.
ARM do not sell any CPUs. the CPUs in mobile phones come from Qualcomm, Samsung, Apple, etc.
For context they also push Google search to iOS devices (Apple gets huge amount of money for that), the same way as they pay firefox to have Google as their default search engine.
The issue though, is that for android phones, it's not a "let's make a deal, we will pay you to have Google Search" attitude. You can't make an android device integrated with Google Play app store without also having Google Search in the home screen and as default search engine.
What the EU is fining among others, is the business practice of forcing device makers that want to use the Play Store to also bundle the other service (Search).
(I guess you could say that didn't see this coming, but the parallels with MSFT and IE are pretty hard to not see...)
The fine is going to hurt a lot more than any remedial action.
This is just a shakedown of Google. In the end the EU consumer will pay the price. Sure glad I live in the US. Just hope Google treats the EU differently than the US. When switch to Fuchsia just charge for it in the EU and give for free in the US.
The consumer will pay more for a phone and still use Google services making Google even more money.
As an independen device maker, you wouldn't be able to put iOS on your devices. Android has a huge margin over other viable alternatives.
They also have the option to write their own OS anytime they want.
The EU commission doesn't think so. Their press release* says that 80% of smart mobile devices in Europe, run on Android.
* http://europa.eu/rapid/press-release_IP-18-4581_en.htm
Basically, all you have to do, is hurt the market in noticeable ways. The sole goal of antitrust laws is keeping the market healthy. They're not fair and have almost no rules attached to them.
It does have a dominant market position though, and that's what's in the legal stuff that they're being fined under. You do not need a complete monopoly to have a dominant market position.
> Secondly, there are device makers that didn't cut a deal with Google, notably the Amazon phones and tablets. They weren't that popular with consumers but that's not Google's fault: it just means consumers highly value the additional services Google provides.
More than that though, they effectively stopped device manufactures from selling these (because of exclusivity agreements), and a lack of range isn't going to have helped amazon:
> For example, the Commission has found evidence that Google's conduct prevented a number of large manufacturers from developing and selling devices based on Amazon's Android fork called "Fire OS".
http://europa.eu/rapid/press-release_IP-18-4581_en.htm
Android being an open source OS is nowhere near as easy to install as a regular linux open source OS.
I've been trying to get my own android / androidTV box working on popular hardware like rPi and other Amlogic, Allwinner, Mali based boards without much success. Even devices manufacturers have troubles with the same (talking about SBCs here).
Android is open source only for name sake. Google's deliberate control over the entire Android ecosystem is undeniable.
In order for device manufacturers to get the Play Store on their phone, they have to give in to Google's demands to add the Google search box on the home screen of the phones.
Apart from this, Qualcomm doesn't release open source drivers for GPUs etc, making it even harder to use pure AOSP on flagship devices.
What's wrong with this? The Play Store is subsidized by search revenue, it makes sense to tie them together.
There's a bunch of SBC manufacturers (pine64, odroid, orangepi, etc) worldwide that have managed to compile AOSP for questionable hardware. However, it is noteworthy that almost none have been able to compile images for Android 7.1 and above that work without hiccups.
As for your problems installing it on other boards, where are the drivers for them? Your classic desktop installation comes with drivers for almost every laptop/desktop board. Android doesn't because the vendors don't contribute. A snapdragon SoC requires a binary blob from Qualcomm. There is nothing you can do without it. It has nothing to do with AOSP being opensource or Google controlling it (Google controls other aspects, AKA the Play Services).
Trying to get the xda builds and LinageOS working properly is subjectively speak—difficult and heavily device dependent.
I’m not sure about x86 images, but arm are heavily device dependent.
Would love be proved wrong. I’m looking for android images actively.
Oh, Google, you're willing to share almost everything with anyone for free, but you want to put terms on that? Hey, here's a giant fine.
I just don't understand the logic of this at all.
The EU laws around this are also worded as such. You can do anti-competitive behavior all you want if you're not a major player because you'll just be shooting yourself in the foot.
Google knows that most manufacturer needs their devices to ship with the Play Store, because that's where the apps are and smartphone without apps are useless. But they use the Play Store as leverage, forcing manufactures to also ship Chrome, rather than Opera, Firefox or their own browser and that's the bit that is illegal.
Imagine that Apple forced telcos to block Spotify, to force users to iTunes, and if they didn't then no iPhones on that carriers network.
That being said I don't think Google is using the Play Store to force installations of Chrome or the Google search app, that's just weird. People would install Chrome anyway and they already dominate search, so why bother. I think the reason is technical, but the end result is still illegal.
Honestly your comment is pretty much kindergarten level argumentation, so I think that maybe you should just take your ball and go home.
The question was regarding to the logic behind why Google is getting fined, while Apple is not, and I think I answered that question pretty well.
If you sort public companies by Market Capitalization, how far down the list do you think you need to go, before you find a company that is only in one market?
Google is forcing installations on Samsung phones, LG phones, etc through their contract.
It is entirely possible what Apple is doing would be illegal IF they licensed/sold the OS to other OEMs.
This is so back-asswards.
This is not an open/closed dichotomy. This is a free/controlled market issue.
If Google manufactured all Android phones, and Android were closed source, and Android came pre-installed with the Play Store, Search, and Chrome, I think it wouldn't be a problem, right?
That turns this into an open/closed dichotomy.
It's plausible that Android would have nearly as many users.
Google, for instance, could have all of the current manufacturers agree to OEM their Android devices. Possibly with co-branding.
That’s what they’re doing here, just like MS did in the 90s with Windows licenses.
Recently KaiOS was gaining traction and what did google? Virtually bought their presence/dominance there… sorry "supported project".
Android’s rise to dominance was mostly because of partners like Samsung.
Personal preference but Samsung phones are the only ones which I see are comparable to latest iPhones in terms of speed, features and price.
With co-branding?
And all of the profits going to Samsung?
This would merely be a different way to structure access to Android, right? Android is closed source, but literally everything else is the same...
Except now it's not "anti-competitive," because the phone manufacturers are not "competitors" to Google.
The same goes for Samsung and its own browser, simply called "Internet": people often have heard of Google Chrome but won't go looking if there's a working "internet button" right in front of them. Other vendors use the same trick.
Personally, I would think this is a good thing as it takes away some of the monopoly Google has, if Samsung etc. would just give their browsers regular updates through the Play Store/their own app store (latest version I can find on the Play Store still uses Chrome 59).
There is no technical reason to install the Google app or to install Chrome. Vendors can easily install their own WebKit/Blink engines for all the WebView/technical requirements (as seen by alternative ROMs) and the Google app can be deleted without affecting the other Play Services.
I think this is a ploy to prevent companies like Microsoft from coming with their own ROMs that focuses on Microsoft applications (Cortana, Bing, Edge mobile, Outlook, Microsoft Office etc., MS have a near complete stack of applications for Android) without offering any pre-installed competition like Google does.
Which only serves as strengthening Chrome's position (Chrome being a I/O vector for Google's ad market).
> and they already dominate search, so why bother.
Which obliterates any chance of a remotely widespread alternative emerging. The homescreen search bar is technically a widget like any other yet it is the only one that cannot even be removed from any stock launcher!
Imagine a manufacturer whose part of its proposition (whether through deals or genuine customer interest) is for whatever reason to sell a phone that comes loaded up with Firefox (or Opera) and has Bing (or DuckDuckGo, or Qwant) as a search widget. This is currently impossible and the decision aims to change that. The fact that Google uses its Android - because there is no viable alternative platform - and Play Store - because without the apps the platform is useless to the general public - dominance in the phone market to strong-arm manufacturers into preloading extensions of its search and ad market is a huge issue, turning the "Google experience" on Android into an all-or-nothing proposition.
But there is a related yet more subtle issue that isn't addressed: log into the Play Store, and you're helpfully logged into all other Google services such as Gmail, Chrome, Calendar, Photos... The only thing you can subsequently prevent is automatic syncing, but cannot disable each one of those services at all (unless you disable the whole app). So basically you log in to download whatever app on the Play Store and you turn on a huge firehose aimed at Google's datacenters. As an Android user the feeling I have of the "Google experience" is one of coercion, not freedom.
BTW your iTunes/Apple Music example is interesting, although it could be developed further to better match the situation.
Of course once you have the device you can do whatever you ... can. Similarly once you have your Android phone you can install an alternative browser.
In fact I have had Samsung phones with two app stores and two browsers. Guess which one was was I unable to delete without rooting the phone first?
I am not a fan of whataboutism, but in this case it just seems unfair that the creator of a (more) open ecosystem is taking all the beating.
Note: I actually hate the search widget as well as the assistant, but there are hundreds of alternative home screen apps.
Doesn't Apple already do this with the App Store? You can't buy an iPhone with Spotify pre-installed and Apple Music can leverage its position of not having to give another company a 30% cut to undercut spotify's prices.
That doesn't mean it is wrong. =)
The problem here is that Google allegedly dictated terms that gave them an unfair advantage in an unrelated market, breaching EU antitrust law.
A stricter antitrust law might have prevented them from gaining such a dominant position in the first place, but that doesn't seem to be the issue here.
IF Google had manufactured all of the phones themselves, and had never open sourced Android, then they could have kept Chrome and Search on Android, and there would have been no problem, right?
But because Google let other people manufacture Androids, and because Google open sourced Android, now it's a problem?
The logic of this is just baffling to me.
And secondly, they're not being punished for having an open source operating system. They're being punished for forcing manufacturers to install their suite of software (simplified). It's not because they open sourced Android. I repeat, it's NOT BECAUSE THEY OPEN SOURCED ANDROID.
As I posted elsewhere:
Couldn't Google have had Samsung OEM phones?
With co-branding?
And all of the profits going to Samsung?
This would merely be a different way to structure access to Android, right? Android is closed source, but literally everything else is the same...
Except now it's not "anti-competitive," because the phone manufacturers are not "competitors" to Google.
If
1. Android still reached 80% of market 2. Terms of OEM prohibited Samsung from making phones with another OS
That would be the same anticompetitive violation
The terms would say that Samsung installs the version of Android 2 (the new and closed source one) that Google tells it to. As manufacturing partners are always told what to do.
That's the issue though. It seems that Google is being punished for being somewhat willing to work with other makers.
Google is exactly in the same position as Microsoft when they were caught red handed doing shitty stuff with the vendors.
The interesting part is both Microsoft and Google prioritized licensing/delivering the OS and associated software, keeping a healthy distance from building hardware. Google tried a bit more with the Nexus/Pixel programs, but even then the target was only for small scale niche devices.
What I am driving at is that once android got traction, Google’s position went way up while vendor’s bargaining power went down, even as vendors where the ones taking the risks down the line. That kind of unbalance makes it easier to have abusive contracts and business practices.
It starts with good intentions (working symbiothically with the makers at innovative products) but things change, and with success I’d guess different kind of people also come into the organization to push more aggressive practices.
Apple has a monopoly on A9, A10, and A11 based computers.
No, it had a monopoly on IBM-Compatible computers, which is a category that includes multiple OEMs that sell compatible machines.
Apple doesn't have a monopoly on any market category where more than 1 player (Apple) is involved.
quote: "The District Court determined that Microsoft had maintained a monopoly in the market for Intel compatible PC operating system"
https://law.justia.com/cases/federal/appellate-courts/F3/253...
Apple has no monopoly on any hardware market where they are not the only one. They cannot dictate terms to any other OEM manufacturing A10-compatible computers.
Apple does not have a dominant market position and does not give away iOS for free.
Making Android free is an anti-competitive practice because it inhibits the formation of a competitive market for mobile phone operating systems. Because Google's practice of making Android free inhibits competition they are not allowed to exploit the lack of competition for profit.
Where is the problem with making Android free?
In their Statement of Objections, the European Commission accused Google of the breach of EU antitrust rules in three ways:
- by requiring mobile manufacturers to pre-install Google Search and Google Chrome browser and requiring them to set Google Search as default search service on their devices, as a condition to license certain Google proprietary apps;
- by preventing manufacturers from selling smart mobile devices running on competing operating systems based on the Android open source code;
- by giving financial incentives to manufacturers and mobile network operators on condition that they exclusively pre-install Google Search on their devices.
Not sure if the same licensing also applies to Google Play Services - if yes, this might make it difficult to even run the apps without getting the license, no matter which store is used.
The Play store is the crown jewel and protecting that massive revenue stream is paramount, it could well become the most important software market in the world.
-Developers -Customers -To be able to survive on fees less than it costs for a credit card transaction -To be installed on something better than Android
And you call all this easy? ;-)
Once that happens, copy cats will pay manufacturers to preinstall, leading to customers, leading to developers who want to tap that still uncrowded market. And once multiple app stores bootstrap, a price war is inevitable - margins of 30% would be undefendable since they would be passed on to the consumer who would switch to a cheaper app store.
It's very clear why Google would want to prevent such a race.
Google Play links on websites are not the problem because on Adroid an app can use App Links [1] to start an alternative store instead of opening a Play Store page in a browser.
[1] https://medium.com/@ageitgey/everything-you-need-to-know-abo...
1. They should release a heavily locked-down version of Android, which manufacturers and carriers cannot modify - apart from basics like bundled apps, widgets and wallpapers (uninstallable). Update would come direct from Google, and hardware support would be limited to specific components.
2. Make all of Android closed source and shut down AOSP. What is the point of it anyway?
This would solve the fragmentation problem, and be better for consumers since they would get updates quicker and for a longer time. Paradoxically it would lead to less 'choice' for consumers.
The fact is that Apple controls enough of the users that everybody wants that they have at least as much influence as Google does in mobile. That they've chosen to protect their fat profit margins and accumulate the largest pile of corporate cash in history while ignoring customers that can't afford premium devices should not insulate them from similar scrutiny.
If the EU wants to preserve any credibility on these issues they should take a hard look at Apple's refusal to allow other browser engines on iOS.
It's the other way around. EU is building credibility that seems to be lacking elsewhere by penalizing anti-competitive behavior.
>requiring mobile manufacturers to pre-install Google Search and Google Chrome browser and requiring them to set Google Search as default search service on their devices, as a condition to license certain Google proprietary apps;
>preventing manufacturers from selling smart mobile devices running on competing operating systems based on the Android open source code;
>giving financial incentives to manufacturers and mobile network operators on condition that they exclusively pre-install Google Search on their devices.
Apple currently pulls in an astonishing 87% of mobile profits. Why on earth should they be excluded from anti-trust scrutiny?
https://www.investors.com/news/technology/click/apple-rakes-...
Take Safari as a case in point. Apple doesn't allow other browsers on their platform which means webdevs have been limited to the parts of the web stack that Apple supports. Which, until recently, was falling pretty far behind the state of the art.
Apple might be breaking other laws, but not this one. Google is breaking this law. Hence the fine.
Apple is incapable of abusing manufacturers as Apple does not work with manufacturers at all. The entire discussion simply does not apply to Apple.
Google monopoly has very little to do with Chrome bundling and a lot with hardware being kept tight closed to kill any competition: the day we have OSS drivers is the day we can have other OSes (which have been already written) fully working; that will allow also software to be fully usable, creating more competition Google will have to respond to, hopefully with more openness and quality.
Before someone replies that drivers have nothing to do with browser bundling, think about how could Google force you to install anything or use any of their services if your underlying OS and surrounding environment didn't depend on anything from them because it wasn't even Android. Example: https://www.gnome.org/gnome-3/
The fact those parts are closed hasn't stopped people releasing custom ROMs. Google and Sony even help you do this.
https://developers.google.com/android/drivers https://developer.sony.com/develop/open-devices/
Microsoft got into trouble because they forced companies like Dell and HP to make their products feature Internet Explorer.
Google is getting into trouble now because they're forcing companies like Samsung and LG to make their products feature Chrome.
Apple is not getting into trouble now because Apple is not forcing Apple to make their products feature Safari. Obviously iOS does feature Safari, but Apple was free to make that choice. There is no OEM here being bullied.
Right, only the end users are harmed, as it should be.
For the record volkswagen only paid 1.2 bn to germany for its emissions scam
https://www.nytimes.com/2018/06/13/business/volkswagen-emiss...
A formal decision—which would mark the EU’s sharpest rebuke yet to the power of a handful of tech giants—is set to be taken during Wednesday morning’s meeting of EU commissioners following a presentation by competition chief Margrethe Vestager, according to the person. No discussion of the decision is expected, the official said.
The EU’s antitrust regulator has been looking into whether Google had abused the dominance of its Android operating system, which runs more than 80% of the world’s smartphones, in order to promote and entrench its own mobile apps and services—particularly the company’s eponymous search engine.
Google, which can appeal, has rejected the EU’s case since the bloc issued formal charges over two years ago. Google says Android, which is free for manufacturers to use, has increased competition among smartphone makers, lowering the prices for consumers. Google also says the allegation that it stymied competing apps is false because manufacturers typically install many rival apps on Android devices—and consumers can download others.
The fine would top the EU’s €2.4 billion antitrust decision against Google just over a year ago.
Wednesday’s expected ruling would be the latest in a series of decisions in which the EU has cast itself in the vanguard of a backlash against U.S. tech superpowers, on issues ranging from competition to taxes to privacy. Ms. Vestager has become the face of that battle, arguing that regulators must do more to restore fairness to the digital market.
The EU’s executive announced Wednesday morning that Ms. Vestager would give a press conference at 7 a.m. ET.
Write to Laurence Norman at laurence.norman@wsj.com
> Despite being a record fine, Alphabet generated about the same amount of money every 16 days in 2017, based on the company’s reported annual revenue of $110.9 billion for the year.
1. https://www.reuters.com/article/us-alphabet-results/alphabet...
The only way to do is to use revenue, but judges should still consider the business profit margin.
You can't. If people are not forced don't write down exactly whether they spent their time on working for the main unit or the side units units, you can't later account it correctly. Unfortunately it's not even clear for the company what happens sometimes. You might for example hire an employee, but place him in a different business unit than originally planned. Or the employee later on changes business units.
The other problem with this is even if you require such a strict accounting setup, you can't tell whether employees and/or departments are accounting their efforts correctly, it's just incredible difficult to enforce the rule; to make sure they don't lie. Even if you think hey you can do it, you have to rigorously enforce this for all companies in your juridiction, because as soon as you stop looking, they will stop caring.
So the problem is you can't tell the profits before "internal investments" as long as you can't pin down operational costs.
You'll see that the only thing that you can accurately account for is the main business units revenue, but you can't give a precise number on operational income. (Which is revenue - product costs - operational costs).
The size of the fine is based on the violation type and size, revenue and a case-by-case evaluation, as company finances vary wildly.
http://www.europarl.europa.eu/external/html/budgetataglance/...
Fines paid to the EU go straight into its own general budget. Combined with the nature of the EU Commission as judge, jury and executioner in cases like this, it is a severe conflict of interest. Member state are refusing to pay more into the budget and the UK is leaving, which will create a massive budget hole. The EU is strongly incentivised to levy fines for vaguely defined, highly debatable "crimes" on US tech firms in order to avoid their own internal political disputes over funding.
The executive fines someone (like you are fined for violating parking regulations), then you can appeal that fine in court, in this case most likely the ECJ.
Would you argue that it's wrong to address a coporation's wrongdoings? EU companies are fined regularly as well, might not create such an upheaval in the US media, though.
The EU is not structured like that, and thus doesn't have to win any prosecution. Margrethe Vestager just issue a proclamation with a number she and the Commission picked out of the air, and the deed is done.
Second: Google can appeal in court. It’s exactly the same as it is in the US.
Neither is the US. Numerous state and federal agencies have the right to directly levy civil penalties. You have the right to challenge those penalties in court, as you do in the EU.
https://www.irishtimes.com/business/economy/european-commiss...
The EU budget (which is very small for such a big project) will actually increase post-Brexit.
Your comment is totally bogus.
Can Google just continue their practices after this?
it'd be interesting to imagine how a company could potentially still operate in a hostile country, if said company is only dealing with cyberspace products (such as software/saas).
Would they be able to continously ignore any/all rulings, by operating the datacenter, and any payment mechanisms, outside said hostile country?
For example in Turkey betting is illegal, turkey will block any bet providers page. But some providers just change their domain regularly.
Seeing as nobody else has read the article.
>If Google fails to ensure compliance with the Commission decision, itwould be liable for non-compliance payments of up to 5% of the average daily worldwide turnover of Alphabet, Google's parent company. The Commission would have to determine such non-compliance in a separate decision, with any payment backdated to when the non-compliance started.
http://archive.is/JpjEI
The stock is down about 1%. Not much considering that $5B should be about 1/3 of Googles yearly earnings.
On the other hand, 1% of Googles stock is about $8B. From that viewpoint, one might think it has come unanticipated.
Then again, stocks rise and fall 1% all the time. So it's hard to read something into it.
Is this the same case as reported in January here?
https://www.reuters.com/article/us-alphabet-results/alphabet...
"Profit fell 35 percent to $12.6 billion because of the tax bill and a separate charge last summer for a $2.7 billion European Union antitrust fine, which is under appeal."
Maybe in future earning reports we will see statements like "Legal fines went up 80% YOY from $7B to $12B and we are planning to continue our aggressive spendings in this area to expand our market dominance".
As a person getting caught stealing/defrauding/etc. you would have to pay restitution and additional fines/time in prison. This is how it should work for businesses to. If the goal is to actually prevent future abuse.
A private individual is expected to return all illegal gains, pay additional fines, and possibly do prison.
But a company might be expected to pay fines that are actually a fraction of the profits made abusing the law. This means paying the fine is more lucrative business than ceasing the abusive behavior.
As such the system only gives the appearance that it's working when in reality it's just not bringing the expected benefits. If paying the fine and keep skirting the law is cheaper than fully complying than that's what companies will do.
Easier to say sorry than to ask permission, right?
Nothing they provide really mandates they have a physical presence.
If Google packs its bags they'll be the ones feeling most of the pain. And such a drastic move would have consequences on any business Alphabet tries to do in the EU over the next decades.
Of course you can expect any government to be a little easier on local businesses but as far as correctness goes the EU has always done a pretty good job.
Sure, if they don't want to get any revenue from the whole European Union anymore. Fortunately the EU is a big enough market so that Google doesn't have any leverage here.
Their 2016 profit was $19.4 billion and without the one-time foreign asset charge it would have been $22,4 billion, as such the fine compromises less than 1/4 of googles earnings.
Their European revenue was $22.6 billion out of $90 billion total revenue for 2016.
This makes it look like an incredible high fine. It's important to notice that the revenue in Europe is mostly google ads. The total revenue for alphabet is also bloated by thing stuff like other bet, which produce $400 million revenue and $900 million loss. Or to put it more bluntly, the revenue in Europe has a stronger influence on alphabets profits than the revenue in the USA.
I still think the fine is incredible high, one reason for this might be a lack of commitment from google after they were fined for $2.4 billion last year.
This being the second time google breaks European anti trust laws. In a really short time.
Last year they were fined for what Brusels describe like this in their press released: Since the beginning of each abuse, Google's comparison shopping service has increased its traffic 45-fold in the United Kingdom, 35-fold in Germany, 19-fold in France, 29-fold in the Netherlands, 17-fold in Spain and 14-fold in Italy.
---- A bit more on why google earnings are weird: "For the quarter of 2017 that ended on December 31, 2017, it actually recorded a loss of $3 billion, but that was due to a one-time foreign assets charge due to the recently passed U.S. Tax Cuts and Jobs Act. If that is excluded, Alphabet would have had net income of $6.8 billion, up from $5.3 billion compared to a year ago. "
yearly "For the entire 2017 fiscal year, Alphabet recorded revenues of $110.8 billion, up from $90 billion in 2016. Net income was $12.6 billion for the 2017 fiscal year, compared to $19.4 billion in revenues in 2016, once again reflecting the one time charge due to the tax law change."
src: https://www.androidauthority.com/alphabet-q4-2017-earnings-8...
https://www.theguardian.com/business/2016/nov/04/google-pays...
http://europa.eu/rapid/press-release_IP-17-1784_en.htm
Google leaving the EU would be, for the company, like Google leaving the US – firing half their staff, losing half their revenue and profits, etc. Absolutely not worth it.
Do you imagine the EU would force every ISP to block Google web search, Gmail, etc? Beyond being technically difficult I do not believe the EU currently has the power to create a Great Firewall of Europe like that.
They "could" block all import of Android based smart phones if they wished (based on noncompliance with trade rules of course).
In all liklihood they'd slap a levy on these imports which would either raise their price making alternatives more interesting to the market. Android devices are dominant in the cost sensitive segment.
Alternatively the manufacturers could push this back on to google or it might provide additional commercial impetus to develop a viable alternative.
That's the beauty of one of the largest economies in the world singing in harmony from the same hymn-sheet. When the collective foot is stamped it echoes around the world.
But Android is much more popular than Apple phones in some EU countries (not all) mostly because it's a lot cheaper. So either a lot of Europeans would have to fork out a lot more than they wanted to for a phone, or decide they couldn't afford a smartphone at all and go back to feature phones.
This is why you admit the EU would never do this.
When the collective foot is stamped it echoes around the world.
Very Orwellian imagery you have there. It wouldn't really echo around the world. Google wouldn't give a crap. Android was created mostly to stop Apple from gaining a monopoly and holding them over a barrel with respect to services (go read up on the origins of the project). It has wildly succeeded in that mission already. If the EU selectively taxes its own people whenever they buy an Android smartphone, this would not only hurt the EU's own popularity significantly (people love their cheap smartphones), but it wouldn't harm Google much or at all because Apple un-clenched a lot since Jobs died and iOS is a more open platform than it used to be, albeit, still nowhere near as open as Android. The rest of the world is sufficient to keep Apple in check anyway.
> Google wouldn't give a crap
LOL
Just to put this in context, the population of the EU is 508M vs e.g. the USA 325M
That's an awful lot of €€€ to turn your nose up at.
We're having this very discussion atop the world wide web which came from CERN.
There's no reason why I should have to sacrifice my privacy so that a few oligarchs can add a few more zeros to their bank accounts.
* https://www.weforum.org/agenda/2017/10/meet-europe-top-tech-...
* https://en.wikipedia.org/wiki/List_of_largest_European_compa...
I actually hadn't realised Spotify was Swedish! Deezer is French.
Pretty much every high-end car manufacturer.
ARM.
Did you know the modern three-point tractor hitch was invented by an Irishman? Modern motor cars come from Germany. The Web as I mentioned earlier comes from CERN which is a joint European project.
Ericsson, Siemens, Philips.
Airbus is also another joint European cooperative.
Raspberry Pi.
Arduino.
Betfair.
Jetbrains.
Interesting exercise!
However, i suspect if google left europe, another competitor to google (ala, bing?) would immediately swoop in and take all the business. Google would suddenly find itself losing 1/3 or even half of their revenue!
A similar analogy would be like the US blocking their citizens from traveling to North Korea. But then having direct flights from LA to Pyongyang and expecting North Korea to enforce the ban of US citizens at their customs. It’s not their responsibility..
To twist your analogy this is basically like the US deciding not to give Pynongyang aid any more, in which case yeah they might just decide to block US immigration.
Given the enormous amount of anti-competitive behavior we see every day in the news, I can't help but feel this fine seems a bit arbitrary.
Probably in part yes, but the European Commission is also pretty proactive. E.g. if I remember correctly, they reached out to Mozilla to get their take on how MS was bundling IE with Windows, after Opera originally complained about it. This came out of it: https://www.google.com/search?q=browser+choice+screen&tbm=is...
Isn't it a bit late though?
The question I meant to answer wasn't about timing but about whether the fine is a result of lobbying.
Not for all the companies and FLOSS projects that have been wiped - or not even started - due to the Google / apple duopoly.
> Is this the result of lobbying?
In all likelihood there was almost certainly an element of lobbying, in particular complaints about these business practices which eventually coalesced into some kind of more focused activities.
It seems a bit quixotic to blame "competitors". Which competitors exactly? That's the whole premise of abuse of dominant market position.
The fines "reflect the gravity and duration of the infringement. They are calculated under the framework of a set of Guidelines last revised in 2006." (http://ec.europa.eu/competition/antitrust/procedures_101_en....). There's a link to the guidelines on the page.
I also had a look at how to file an anti-trust complaint but to be honest, most info was over my head and more appropriate for a lawyer - this seems to be a good start: http://ec.europa.eu/competition/contacts/electronic_document...
I imagine they read the antitrust law and then applied it. I could be wrong, though. Maybe it's because "they hate America for its freedoms."
Whenever allocating limited enforcement resources, you would expect the most egregious violators to be targeted first, with immediate social benefits and prompting self-compliance for smaller actors.
We're all a lot better off, even people that use iOS, because there has been real competition in mobile. This is essentially choosing which business models the EU thinks should win.
I'm sorry but this move is garbage. I am British and I'm so glad the UK is leaving this horrible, success hating farce of a union. Google paid billions to develop Android and then gave it away for free under the Apache license specifically to encourage competition and diversity in the smartphone market. They then added a carrot of some apps and the app store if OEMs agreed not to introduce backwards incompatibilities, to avoid the J2ME problem of a hopelessly forked and buggy platform.
If they hadn't done these things, very likely Apple would have wiped out every competitor in existence.
The EU is sending a powerful message with this move: keep everything proprietary, pick a high enough price point to price out most poor European countries, and you'll be fine. Build an open ecosystem where competitors target every price point and you'll suddenly find yourself being an involuntary contributing member to the EU's budget. What a great disincentive to build products for the Spanish or German markets.
Your points have been addressed above already, if Apple had a dominant market position, the EU would have handled things differently. And Apple has been fined by the EU before as well.
Raw numbers don't tell the whole story here.
However if the alternative is having to deal with the EU Commission then yep, I guess hard brexit is the next best alternative.
The reason the EU doesn't have any local mobile companies isn't do to with Android or Google's licensing terms. The EU had a very successful mobile firm and it shot itself in the foot over and over so badly it disappeared, because its own competitor(s) to Android just weren't good enough. Nokia was hopelessly out-engineered by Silicon Valley and in hindsight it would have done better to admit that, and become an Android OEM itself. It wouldn't have had to cut any deal with Google. It already had Ovi Maps and its own app store infrastructure. It could have done an Amazon and adopted Android without any strings attached.
But most of the European political elite want to unite the continent under a single government instead. Given that, the best kind of Brexit would be one where the UK is no longer a part of this, and can sign various unlinked bilateral treaties to continue cooperation in the areas where there is agreement, and discontinue in areas where there are disagreement.
This makes perfect sense - agreement on everything is rarely possible, so collaboration on the areas where people do agree is the best you can do. It's also exactly what the UK has proposed repeatedly. However the EU refuses to allow it, exactly because if people were offered that alternative the EU and associated gravy train would cease to exist tomorrow.
Maybe the UK media points a wrong picture of the mood in the EU, but I seriously doubt that it would cease to exist if your alternative would be put forward. But that's something all Brexiteers tell themselves repeatedly, over and over, like a mantra.
If every population that's asked rejects the EU's vision what on earth makes you so sure that a comprehensive alternative wouldn't be popular?
Also there's no such thing as "picked apart" in the sense you mean, i.e. outside of military strategy. Nobody is picking North Korea apart despite that it's a world pariah. If a country doesn't want to collaborate with another country or accept its terms, it doesn't have to - the idea that cooperation is a form of warfare is exactly the mentality that the EU has, and is why it's so desperately dangerous and problematic as an organisation.
They're currently headed towards not really exiting the EU. Once they looked into the details they determined that the drawbacks were outright lies (350M GBP/week) and the benefits are huge. It might even end up as a paper exercise.
When Android was launched is was just another unknown piece of software, poor performance, lack of features, etc.
They can't both reap the profits of open source and then reject any disadvantages (such as with their anti-fragmentation clause).
They have the option at any point to go closed source and face the huge shitstorm that will follow.
Yes, why is that surprising ? They would also not get the benefit of OEMs shipping their bundle of services across the globe.
>gave it away for free under the Apache license specifically to encourage competition
It has nothing to do with increasing competition. It's anything but. That's one of the reasons for the fine. The non compete clause prevents OEMs from creating forks of Android.
What their agreements require is that the forks be compatible with base Android, that is, apps should run the same on every variant of Android. It's designed to ensure app compatibility and avoid the mistakes of the past, like with J2ME where apps had to be debugged on every single phone because they were all riddled with bugs and incompatibilities.
But outside of app compatibility issues vendors can and do make big changes, everything from the appearance to the UI to the set of bundled apps - Samsung for instance replaces the browser, replaces the calendar, replaces the contacts app, replaces the home screen, replaces nearly everything. And Samsung is a Google licensee. So clearly, your understanding of what Google is doing here is not accurate.
Did you read the main points of the press release ? If you (say an OEM like LG) license google play, you cannot create a competing OS based on AOSP. It has nothing to do with OEMs customizing AOSP for the devices they sell. It has everything to do with, say, an OEM selling a different phone that can run Amazon's version of Android with Amazon's services. I think that's one of the reason's why Amazon's phone never caught on. Nobody other than Amazon would be able to make or sell one because everyone had licences from Google.
From the press release:
"Google has prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device running on alternative versions of Android that were not approved by Google (so-called "Android forks")."
It is okay for them to do whatever they want with their Nexus/Pixel devices, since they fully own them. But forcing some random DTV vendor to install Google Search, Google Social Network, Google Online Shop, Google Payment System, Google This and Google That, just because the vendor chose to adopt a free operative system into their system, it's just abuse of power and monopoly.
It automatically gives Google an advantage over the Search, Online Shop, Social Network, etc, markets. It is basically impossible to start a new video streaming business in the DTV market, for example, when you know that every single DTV system has Youtube already installed just because Google mandates so. And Youtube is "good enough" for 90% of the people.
The entire world doesn't suddenly owe something to Google just because they made something open source.
Apple tied together iOS and their own apps for a long time. Although Google provided the map data, the maps app on iOS was Apple's and for the longest time they banned anyone from writing competitors to it (ditto for music apps etc). They now pre-install their own maps app and prevent competing apps from actually becoming the default.
Your second paragraph is just wrong. Nobody is forced to use the Google apps. They're sold as a bundle and you can use Android without buying them. That's what it means for Android to be open source. Google can't "force" third party firms to do anything, especially not TV vendors where apps hardly matter.
Your third paragraph is also wildly wrong - how can it be impossible to start a new video streaming business when just yesterday there was a big discussion here on Hacker News about the stall in growth of Netflix and how their content library is poor because content providers are all setting up their own streaming services? There are lots of video streaming services around today and more are being created all the time. There's even one in France (dailymotion).
Thanks to Google they can even create apps for their services and it's easy for those apps to be installed on new smart TVs. YouTube is hardly the only streaming service, I routinely watch Netflix and watch shows I bought off iTunes.
The entire world doesn't suddenly owe something to Google just because they made something open source.
What a horrible attitude. Google doesn't owe the world open source code either. It's a gift. You might decide you don't like that gift, but the code is Apache licensed. It literally comes with no strings attached. You can do what you want with it.
But the fact that you feel it's impossible to set up something as basic as a video streaming service says a lot about the European mentality, to be blunt. I see America setting up video streaming services left right and center. There's Hulu, HBO Now, Disney's new service, Vimeo, Facebook and Twitter have integrated services. It isn't impossible. What you mean is it's easier to let other people do the work and then demand they pay big fines than to set up a company and compete.
For instance if Philips wanted to ship an Android TV without spyware, they would have to remove some Google apps => anti-fragmentation clause kicks in => Philips isn't allowed to sell official Android devices any more.
But they can continue to sell Philips-Android devices which nobody would want because they're missing critical features which would be disabled by Google shutting down their official Android access.
So actually Google has Philips by the balls, even if Android is open source. The EU doesn't like that.
Which is as it was before, of course.
On looking into the judgement however it appeared as though both parties actively sought to subvert competition rules under a disingenuous "veil of ignorance". Warning shots had been fired earlier but the practices continued hence the fine.
I haven't read into the details of this judgement yet but you may well find similar reasoning therein.
While it's certainly Apple's prerogative to play EU states off against each other to get the best deal, it should have been blindingly obvious that what it was getting from Ireland would be, and should be reversed.
> it should have been blindingly obvious
and yet, it took a deep-dive investigation by the commission with a team of specialists to untangle it.
And blindingly obvious to Apple, the benefactor.
When somebody says, "Hey come and do your stuff here, we'll only charge you 0.005% corp tax!" you should expect that their wider financial governing body (who is losing out severely because of a deal like that) might have something to say about it.
You saw that thing in the ICIJ Jersey papers leak where Apple went round the world actively seeking jurisdictions that would twist their tax rules to suit them?
https://www.irishtimes.com/business/apple-s-cash-mountain-ho...
I'm saying that when you get a deal this good —however you ended up there— you should not be surprised when it turns out that it was illegal.
Of course Apple shopped around. But if somebody offered to sell you $20 bills for half a cent each, would you suspect something dodgy? That's the scale of the issue here.
This is just a drop in the ocean for the total amount of wealth that is protected with these schemes. In the $20 for ¢0.5 picture this probably amounts to ¢50. They're still making off with the other $19.49. Though arbitration would probably round that up.
An acceptable loss.
It's bleedingly obvious that it's illegal to be taxed differently than other companies. Paying back €13bn is nothing.
Companies that "make deals" on tax anywhere in the world should be effectively banned from the EU market. It's pure evil. Or pay 10x of any gain they have made anywhere in the world by "making deals" on tax, thereby undercutting fair competition in a free market.
But saying "hey, that's obviously corruption" isn't enough. We need a good way to restructure tax collection so that the right people get it.
Multinationals paying Luxembourg (Paypal, eBay) or Ireland (Apple, Amazon) for all revenue and operations from the entire EU is wrong, no? How do you fix that?
The particular problem with the EU is that it's a system of "good faith" agreements that has until quite recently been quite weak against cynical attacks.
This kind of dealing undermines the spirit of the EU accords and you can expect it to be dealt with in the course of time - probably through tax harmonisation, which wouldn't then be a million miles away from the american model.
You are not supposed to be able to get special privileges to your company to the detriment of your competitors.
There can be no free market when justice (and thus taxation) is not blind.
Capitalism is a perfectly good system of economics and I look forward to seeing it in place some day.
"The Irish government agreed a deal with Apple in 1991 to only tax a certain bracket of its earnings" http://uk.businessinsider.com/how-apple-managed-to-get-its-t...
To me it's pretty obvious that Tim Cook will burn in hell :-).
Though tax avoidance was a corporate strategy and they actually sought these deals it would not have been obvious that this was technically illegal. The Irish Revenue Commissioners told them it was legal as an interpretation of Irish law, which was incorrect.
It certainly IS NOT. When Apple "get's a deal" it is by definition market manipulation. You're not supposed to "get a deal" regarding taxation!
The same taxation rules must apply to every company or else there is illegal subsidy. The whole idea around "making a deal" on tax is horrendous anti-capitalist BS.
It's exactly the same as "making a deal" wrt the law in a corrupt country. A corporation "making a deal" by having government look away when they do something illegal, or getting their competitors fined on dubious charges.
Apple, Google, Microsoft, and basically all of those companies ARE THE SCUM OF THE EARTH for not refusing do to business with the market-corrupting Irish Republic.
I don't see why EU should "work with google" to make them follow regulations (EDIT: beyond the threat of punishment).
Who else do you think they should pursue instead?
We can prosecute equally for jaywalking, but anti-competitive behavior gets worse the bigger the offender is and/or the worse offense they commit. So in that way it makes sense to prosecute "top-down", that is go after the biggest ones first.
That's at least what I prefer as an EU member state citizen and consumer.
Following that logic, the same applies to law in general. Should we therefore abolish law?
The commission and national (European) regulators are investigating ~150 cases every year, most of which none of us will ever have heard of.
http://ec.europa.eu/competition/ecn/statistics.html#2
The ones I know about have all been the result of a complaint made by competitors. I would be surprised if the regulator could selectively reject such complaints without good reason.
What makes you think that they didn't? Have you even read the WSJ article? It says:
"Google, which can appeal any decision, has rejected the EU’s case since the bloc issued formal charges over two years ago."
If I went out into the street and 'keyed' someone's status symbol car then I would not be in trouble until someone decided to do something about the crime.
The owner might not be pleased and, pressured by the insurance company, might get the police to go through CCTV and finally find me caught in the act.
Alternatively, a neighbour or passer by might just call the cops on me whilst I 'brazenly commit the deed'.
Either way, unless there is a report of wrong-doing then I would be getting away with it, not having to be fined etc. The police don't just sit there idly looking through the rule book looking what they can nick me for, someone would have to bring matters to their attention.
And that is the problem with this EU ruling. Nobody I know has bought a phone, decided to write to their MP (or MEP) and complained about not having Bing! as their default search engine. The EU don't accept complaints from little people like that anyway.
So what has gone on here is that some group of lobbyists have sought out some money from the Microsofts of this world, invariably to setup some fake pressure group, to bring on this legal action. With previous history, e.g. bundling in Windows, the modus operandi was the same, albeit with Netscape being the whinging ninnys.
Whwn the story finally hits the press the parasitical legal firm, the fake consumer group and who fronted the cash to pay for the action get forgotten, instead debate concerns whether the E.U. is a load of rubbish, being as silly as when they banned bent bananas and had wine lakes or whether Google have been truly evil.
In The Emperors New Clothes the people that sold the expensive invisible thread leave the story so in the final act there is just the stupidity of the crowd and the stupidity of the Emperor, story facilitated by the boy. Similarly here, the people that have wreaked this carnage have left the story a long time ago.
You are assuming that Google is a poor layman that is accidentally breaking laws. Indeed Google has an army of lawyers and they know precisely well the risk of their actions.
Although, they should have put a fine of $12b (all of googles yearly earnings), effective immediate, and double it every year until non competitive practices ended.
Fining Google 4 billions after they forced all sort of lock-in strategies on the users for a decade is less than a slap on the wrists.
No one locked you up at gunpoint.
Stealing from a corporation 5B and lining the pockets of politicians as "justice".
Corrupt af
As it is they seem to make very rude guests.
http://europa.eu/rapid/press-release_IP-16-2582_en.htm
https://www.reuters.com/article/us-eu-telefonica-fine-idUSKB...
It looks like the EU has created a piggy bank with these regulations on hostage tech corporations. I wonder how much of the large fines is attributed to prosecutors or politicians trying to make a name for themselves.
Anyone know how often these record fines hold up on appeal?
Edit:
Wow, lots of people triggered by this comment. Must be because it's between 4AM and 7AM in the US while being the afternoon in most of Europe.
I stand by everything I said. EU regulators shouldn't be able to entitle themsleves to around 40% of Google's yearly profits. If the laws in the EU intended for this then they are backwards and harmful to innovation. That 5 billion dollars could go into life sciences, self driving cars, and a bunch of other stuff that materially improves society. Instead it's going into EU coffers.
Google's services add massive value to the world while regulators have done nothing. Fines on Google by the EU total over 7 billion dollars over the last couple of years. Ridiculous, and I'm surprised y'all are trying to justify this cash grab.
Why would you claim something like that without providing any evidence that this is actually the case?
The arrogance of Americans to believe their legal system applies everywhere and that any attempts to apply a different one constitutes an attempt to raid the piggy bank is kind of amazing. I wish it wasn't such a prevalent view but you see comments like the one you responded to every single time a fine is levied.
How the hell can the EU entitle itself to 40% of the profit of a company that provides a massive value add to the world? Email, search, maps, video, cloud, office apps and so much more.
I don't think Americans are the arrogant ones here, with the EU levying multi-billion dollar fines on a yearly basis.
...
In the article : "Google, which can appeal any decision, has rejected the EU’s case since the bloc issued formal charges over two years ago."
My view on this situation is that regulators should decide if such bundling is allowed on a case by case basis. Then, the ruling is 'We have made a decision. You get X fine if you do not comply.' Rather than, 'We prosecutors think you are not complying' followed by 'Yep you were not complying, give us billions'.
(The 2017 income of google is lower because they decided to use the new US tax law in order to move a lot of money to the USA which cost them $9.8 billion. But you can't say your income is low just because you spend it all on ice cream. This is why I use the adjusted number of $22.4 billion)
The question is rather, "Should this law exist?" The answer is no. A law which allows this magnitude of a fine for the behavior described is ridiculous.
These are not laws sent down by god. Some elected or not elected officials sat down and decided on some stuff - and they can make mistakes. Have you seen the US congress questioning Zuckerberg and the elementary level of the questions asked? These are the EU analogs, making laws (probably not as incompetent though).
(Risk of not getting caught)
It's a percentage of their yearly revenue (or income, not sure). If a company breaks the law and you want it to stop doing that and change their behaviour, you need to be able to hand them a fine that makes them stop and think. Would you prefer if they were handed a $100 fine instead? What would be an appropriate fine for you? I think a moderately high percentage-based fine is the only way you can do this.
The EU has laws. Some of these are different to those in the US, not just in wording, but in aim. There's definitely a much stronger drive to protect consumers from companies exploiting them through data and market abuse, wherever those companies are.
Or is it the tech corporations holding consumers hostage, and are regulators trying to fight that.
Honestly, for the value that Android gives phone manufacturers I am surprised that Google's requirements were so low. Android gave the phone manufacturers a platform and asked for little in return.
It does not matter what Apple is doing this is about Google. I would expect that there are ongoing investigations against Apples practices regarding similar issues too.
>Honestly, for the value that Android gives phone manufacturers I am surprised that Google's requirements were so low. Android gave the phone manufacturers a platform and asked for little in return.
Not being allowed to release competing OSes / forks and other software is more than a "little" in return. Google does not give android away "for free" because they want to help others they do it because they want to help themself get into everybodies smartphone.
Most members in the EU also completely lacks the "personal branding" of judges, they usually aren't elected and politics and law intertwine less so in EU than in USA (again, as I understand USA).
It's not like you have to be a legal genius to know the rules. They are right in the treaty (think of it as the EU constitution) and Google know about the many previous cases interpreting the rules that share similarity with theirs, including Microsoft's case about bundling Explorer with Windows and making it the default browser.
So Google and their hundreds of lawyers are well aware of the rules against abusing dominant position. Nevertheless, they have chosen to ignore the rules - maybe because they stood to gain so much money on breaking the rules.
When Google does business in Europe, they make use of European laws such as the trademark rights that grant them exclusivity to the brand "google", the copyright that grant them exclusivity to their source code, patent rights that grant them exclusivity to their many inventions, and hundreds of other laws that ensure that Google - just like European counterparts - can rely on the rule of law to protect them while they make money. Google itself has likely benefited tremendously from the exact same European competition law, that they are now fined for breaking. Were it not for such laws, Microsoft or Apple could and would likely have toppled Google from the advertisement market simply by forcing their own search engines, browser, maps, emails etc. on users of their operating systems.
Whether the administrative decision of the European commission to fine Google will hold up in court will be seen if Google decides not to accept the fine. So far the European Commission has had a good track record.
IIRC, the "original" record fine imposed on MSFT was ~€500M, and ended up to ~€2B after various further run ins and appeals.
As if this doesn't happen on the other side of the pond. Claiming only EU does this is intellectual dishonesty
Lol, you know where the EU spends their money right?
https://europa.eu/european-union/topics/budget_en
6% is spent on admin.
41% is spent on agricultural subsidies and research (e.g. making sure we don't all starve in the future).
46% is spent on development, about 2/3 on helping underdeveloped areas of europe, and 1/3 on helping business growth.
On research alone, $10bn is spent on Horizon 2020, which is one of the pure research funding projects.
Regarding potential gains, Android has all but cemented its position as the smartphone OS. Microsoft did the same in 1995 with Windows in the desktop market and it has 90%+ marketshare there, 23 years later. It's very likely it will still dominate the desktop market in 2045.
Android will be at least a loss leader for Google for decades to come. And they made $10 billion in profit in 2017 alone (of course not all of it is driven by Android, but you get an impression of the scale).
https://www.theverge.com/2011/05/12/google-android-skyhook-l...
I know that anti-trust laws are probably not applicable as Apple does have a dominant position based on total market share, but to me this practice seems far more anti-competitive. Banning competitors seems worse than fully allowing competitors but providing your own as default that can easily be changed.
With 'root' access, it's possible to remove them via a superuser app or adb - or it used to be the case.
On Android you can pick whatever apps you want as the default.
Notably Google made their own maps app and Apple banned it:
http://www.businessinsider.com/apple-screws-google-over-lati...
But it also applied to iTunes competitors:
https://www.engadget.com/2008/09/12/app-disqualified-from-ap...
It's deliberate to kill competition while not being in a dominant position, and then when in a dominant position, continue the trajectory by defining defaults.
The Apple apps are dominant partially because of the abusive rules the app store had earlier. It's quite clear from the fact that in any area where Apple did not have a default app, they are unable to match what the free market offers.
It's an interesting question though, because it depends on which 'market' you're talking about. This is a vexed question in antitrust law [1]. There is some pending litigation in the United States as to whether Apple illegally monopolized the market for iPhone apps [2], but it's been brought by app purchasers rather than the regulator, and Apple has taken the case to the Supreme Court to argue that the purchasers don't have standing to sue.
[1]: https://en.wikipedia.org/wiki/Relevant_market
[2]: http://www.scotusblog.com/case-files/cases/apple-v-pepper/
The "happy medium" we have today: where jailbreaking was found to be not illegal, works for as long as we can jailbreak. I note that iOS does now allow sideloaded apps too, though they still must run in the sandbox, but it does mean you can distribute an app that wouldn't be approved for the App Store.
The EU had another workaround: impose a higher import tariff on video game consoles than general-purpose computers. Sony released a Linux kit for the PS2 so they could say the PS2 was a general-purpose computer, not a console. I think it worked initially but because hardly anyone bought the Linux kit (it wasn't sold at retail with the console) the customs people took a look and Sony had to start paying higher tariffs.
Do tell how one could switch out the map from Google Maps to anything else (Bing, OpenStreetMap, whatever).
Or how I could get rid of Google+ without needing to wipe my device or use a zero-day.
Or perhaps how I could get apk files from their repository without agreeing to the Google TOS and privacy policy, and without using some hacky system like Yalp store that breaks every couple of weeks for a little while.
This is definitely not easy to swap out. I bet that even from the top 10% of tech-savvy people on hacker news, there's 9%. that cannot figure out how to remove google completely within a normal working day of 8 hours.
And this is just one example, there are a hundred more things that are in the proprietary google suite, without which you'll be able to install only a few of the apps available for the platform.
Just install another maps app and set it as default? And just because Bing and Apple haven't created Android apps doesn't mean it's Google's fault.
> Or how I could get rid of Google+ without needing to wipe my device or use a zero-day.
Most phone these days don't even come with Google+, and if they do, no one is forcing you to login. You can disable it entirely.
> how I could get apk files from their repository without agreeing to the Google TOS and privacy policy
Doesn't that apply to almost any software with a license?
But Android claims be FOSS. I understand that "using google servers" != "the AOSP project", but there's a large number of apps whose only publication channel is this ubiquitous play store, because the devs know that practically everyone who has Android will opt into the google kingdom as well. If it was closed source like iOS and if you can't even sideload apks (or ipas or whatever they are) then I'd not be surprised that I have to agree to some near-monopoly's TOS and privpolicy in order to get access to 99% of the published apps.
I cannot change the defaults in an Android phone and sell it to you. That's the problem.
Have you tried Google Duo?
In addition, said closed source components and services are merely defaults, and you can install anything you want?
Example: Bing Search, Cortana with full Android Assistant support, Microsoft Launcher (which has full Bing and Cortana support, just like Pixel Launcher has for Google), and Microsoft Edge.
Further Example: TouchWiz, Bixby, Samsung Browser, Samsung App Store, Samsung Pay, Samsung Everything. If there is an AOSP/Google app, Samsung has probably replaced it with a custom app that is not based on the AOSP/Google version and has generally ruined their phones with them.
I guess the EU has to fine Microsoft and Samsung too, since they also give away closed source OS components for Android, and they can only be used with Microsoft and Samsung services... even though it is optional to use them and can be replaced with something else.
I guess the EU has to fine Apple too, since they do not allow third party components at all, all the way from third party app stores, third party browsers, or anything deemed "overlaps with functionality in iOS (retroactively as well)".
In the form I stated, this is true, to get Play you must ship Google Search, and must do so on all of your devices.
What is not true, but implied by the EU ruling is that, a) Android (as defined as purely AOSP) is incomplete and unusable without Google apps, b) that other app stores do not exist for Android, c) that other search engines somehow magically don't work on Android.
None of those are true. I find it unfortunate that Android does not have higher profile alternative options, but no one else seems to want to put as much effort into their products as much as Google has.
Google's actions simply do not meet any reasonable definition of being a monopoly. Google's only action is requiring the entire Google Apps suite shipped on a device as an all-or-none license, it does not require the end user to use them, it does not prohibit the end user from installing others or disabling built in apps, it does not require signing into a Google account to use the device, it does not prevent APK sideloading.
And, until recently, Google was not even a phone OEM (and arguably still isn't, as they do not build their Pixels, HTC and LG do), and Pixels are not nearly as popular as Samsung Galaxy S series (which are famous for "ruining" the Android experience by using tons of custom Samsung apps), and LG G and V series, and Motorola phones dominating the mid-tier segment, and China and India being largely Xiamoi, Huawei, and BBK (Oppo, OnePlus, and Vivo).
Worldwide, Samsung and BBK are the #1 and #2 phone manufacturers, and they merely use Android as their OS. At what point did the EU have the authority to say Google had a monopoly when they do not sell Android phones in any reasonable capacity.
Free market advocates are always talking about regulations and the need for free markets but don't seem to care so much about monopolies, outsize profits, the accumulation of market power and its abuse that further impedes the operation of free markets and the billionaires that result.