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Google hit with billion-dollar EU fine

(Image credit: Image Credit: Denis Linine / Shutterstock)

The European Commission has fined Google a record $5bn over how it abused the market dominance of its Android OS.

According to EU Competition Commissioner Margrethe Vestager, the search giant broke EU antitrust laws by bundling its search engine and Google apps with Android, blocking device manufacturers from creating devices running forked versions of Android and by paying manufacturers and network operators to exclusively pre-install the Google Search app on their devices.

Google's parent company Alphabet now has 90 days to alter its business practices or face penalties of up to five percent of its average global daily turnover. The company has said that it will appeal the decision though it could easily afford the fine since its cash reserves totaled almost $103bn at the end of March.

Google's Chief Executive Sundar Pichai responded to the European Commission's ruling in a blog post in which he defended the company's decision to include its own apps with Android devices, saying:

“The free distribution of the Android platform, and of Google’s suite of applications, is not only efficient for phone makers and operators—it’s of huge benefit for developers and consumers. If phone makers and mobile network operators couldn’t include our apps on their wide range of devices, it would upset the balance of the Android ecosystem. So far, the Android business model has meant that we haven't had to charge phone makers for our technology, or depend on a tightly controlled distribution model.”

Vestager previously fined Google $2.1bn for promoting its own shopping comparison service over that of its rivals and a third investigation is currently underway regarding the firm's AdSense advertising business.

Image Credit: Denis Linine / Shutterstock

Anthony Spadafora
After living and working in South Korea for seven years, Anthony now resides in Houston, Texas where he writes about a variety of technology topics for ITProPortal.