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As expected, European officials on Wednesday slapped Google with new anti-competition charges related to its Android operating system, broadening the company’s legal battles there in the process.
In a Statement of Objections, the European Commission formally charged Google with breaching European Union antitrust rules by using its market dominance to impose unfair restrictions on Android handset makers and mobile network operators.
Google Wednesday denied that it had breached EU rules and described its business practices surrounding Android as enabling competition while giving consumers more choice and control.
“Android has helped foster a remarkable—and, importantly, sustainable—ecosystem, based on open-source software and open innovation,” Google Senior Vice President and General Counsel Kent Walker said in a statement. “We look forward to working with the European Commission to demonstrate that Android is good for competition and good for consumers.”
One of the charges against Google has to do with the company’s requirement that Android handset makers that want to preinstall Google Play on their devices must also install Google Search and those that want to preinstall Google Search also install Chrome.
The requirements ensure that Google Search and Google Chrome are preinstalled on a vast majority of Android handsets sold in the 28-member nations of the EU. “The Commission seeks to ensure that manufacturers are free to choose which apps they pre-install on their devices,” a European Commission fact sheet noted Wednesday.
This is especially important because consumers have shown a tendency to stick with whatever apps are preinstalled on their devices rather than go out and find similar ones to install, the EC said.
The other issue raised in the Statement of Objectives pertains to a Google “Anti-Fragmentation Agreement” that prohibits Android handset makers that preinstall the company’s apps on their devices from selling mobile devices running other Android versions or forks of the operating system.
The policy essentially limits consumer choice by preventing handset makers that want to preinstall Google apps from offering devices running anything other than Google’s Android version.
In a speech this week, a transcript of which was posted online, European Commissioner for Competition Margrethe Vestager said the reason her office is investigating Google is to ensure that big companies do not use their dominance to stifle competition.
“Our concern is that, by requiring phone makers and operators to pre-load a set of Google apps, rather than letting them decide for themselves which apps to load, Google might have cut off one of the main ways that new apps can reach customers,” she said.
Vestager has not said what consequences Google could face if her office determines the company broke EU competition rules. However, some analysts have suggested that in theory at least, Google could face billions of dollars in fines from revenues earned in the EU over the past several years.
In a blog post, Walker described Google’s partner agreements as entirely voluntary and said handset makers and network operators are free to use Android without Google. Manufacturers whose devices are tested and certified as being able to run Android apps are free to choose whether they want to preinstall Google apps or not. And those that do are free to install other apps of their choice.
Ezra Gottheil, an analyst with Technology Business Research, said the EU’s latest move is likely a relatively small deal for Google. “It doesn’t affect development or marketing; it’s a legal issue,” he said. “Right now, Google’s packaged apps and services dominate the market, so most customers will expect them on their smartphones whether or not OEMs are required to install them.”
Given a choice, most users are likely to choose Google apps and services anyway, he said. “A change in bundling requirements will increase the importance of Google maintaining its lead in customers’ preferences, but that would be true in any case,” he said.