Alphabet Inc’s Google has been fined Rs. 1,337 crores by the country’s competition authorities for anti-competitive behavior involving Android mobile devices. According to a tweet from the CCI, Google was punished for “abusing dominant position in various areas in the Android mobile device ecosystem.”
Google operates and controls the Android operating system (OS) and licenses its other proprietary applications. This operating system and Google apps are used by OEMs (original equipment manufacturers) in their mobile devices.
As a result, they enter into several contracts to regulate their rights and obligations, such as the Mobile Application Distribution Agreement (MADA).
“MADA assured that the most prominent search entry points, notably the search app, widget, and Chrome browser, are pre-installed on Android smartphones, giving Google’s search services a significant competitive edge over its competitors,” the CCI declared today.
“Furthermore, Google obtained a major competitive advantage over its competitors in connection to its other revenue-generating app, YouTube, in Android smartphones,” the CCI said. “Competitors of these services could never obtain the same level of market access that Google gained and embedded for itself through MADA…create major entry barriers for competitors of Google to enter or operate in the markets concerned.”
According to the CCI, Google complained about Apple Inc.’s competitive constraints.
According to the CCI, the differences between the two business models impact the fundamental motivations of business decisions. Apple’s business is essentially centered on a vertically integrated smart device ecosystem that focuses on the sale of high-end smart devices with sophisticated software components.
“Whereas Google’s business has been revealed to be driven by the ultimate goal of increasing users on its platforms so that they interact with its revenue producing service, i.e., online search, which directly influences Google’s sale of online advertising services,” the CCI added.
In April 2019, the trade regulator sought a thorough investigation into the problem in response to buyer worries about Android-based cell phones in the country. Android is an open-source mobile operating system used by smartphone and tablet makers.
The allegations of unfair commercial practices centered on two agreements — MADA and Anti Fragmentation Agreement (AFA) — signed by Android OS OEMs with Google.
The Competition Commission of India (CCI) is India’s major national competition regulator. It is a statutory agency within the Ministry of Corporate Affairs responsible for enforcing the Competition Act, 2002 in order to promote competition and prevent acts that have a significant detrimental effect on competition in India. The CCI investigates situations that have a negative impact on competition.
CCI also allows mergers under the legislation to ensure that two merging enterprises do not dominate the market. The commission was established on October 14, 2003. It became fully operating in May 2009, with Dhanendra Kumar as its first chairman. The current Chairman of the CCI, Ashok Kumar Gupta, was appointed to the role in 2018.
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