After Facebook, it’s time for Alphabet-owned Google. On Wednesday afternoon Commissioner Margrethe Vestager sake the Google. Google has been hit with a record-breaking €4.34 billion ($5.06 billion) fine. The fine has been imposed by the European Union. European Union found Google guilty for abusing the dominance of its Android mobile operating system, which runs more than 80% of the world’s smartphones.
Android has played a vital in Google success, it gives Goggle an unfair advantage in attracting users to those Google apps. While the users are busy in enjoying the feature of Google applications like YouTube and Google Crome, Google do his work in background. Google collects the users data from there devise, which help Google for targeting the advertisement.
Google does not reveal how much revenue it makes from Android, it has said that its advertising business is growing much faster on mobile than desktop.
European Union said that Google is abusing the market dominance in mobile phone operating systems. Google forces the smartphone manufacturers to pre-instal Google’s search and browser apps devices using its Android operating system, otherwise they would not be allowed to use its Google Play online store and streaming service.
European Union also says that the Google paid manufacturers and network operators to keep other competitor search engines off their phones, and thirdly obstructed the development of competing mobile operating systems which could have provided a platform for rival search engines to gain traffic.
Alphabet has been given 90 days to change its business practices or face further penalties of up to 5% of its average daily turnover.
Meanwhile competitors have long complained that Android’s dominance gives Google an unfair advantage.
Ms Vestager told reporters in Brussels: “Google has used Android as a vehicle to cement its dominance as a search engine. These practices have denied rivals a chance to innovate and to compete on the merits. They have denied European consumers the benefits of effective competition in the very important mobile sphere. This is illegal under EU antitrust rules.”
She said that pre-installing Google search on its devices was “an advantaged that cannot be matched” by competitors, making it harder for rivals to compete fairly and harming consumers.
Further Ms Vestager said “Any company is welcome to do business in our single market but they need to comply, they need to play by EU anti-trust rules and these rules are set in place for very simple reasons: to protect European consumers and effective competition”.
She noted that it was important that “technology serves us, and not the other way around”
After this news, Google immediately said it would challenge the ruling at the EU courts. Google said in a statement that it would appeal the ruling, arguing against the EU’s view that its software is restrictive of fair competition. Android has created more choice for everyone, not less, a spokesperson for the Google said.
In defense, Google had said the users were free to delete or disable its apps. The company had strongly pointed that the Android is a open-source operating system. Google said Android is a open-source operating system, which means any company can use it for there devises. Google also said that the open-source feature of Android help manufacturer to keeps the manufacturing costs low.
Google also pointed to Apple saying that the smartphone maker did not sufficiently constrain Google. Apple also pre-installs a number of apps on its iPhone models.
Along with the fine of €4.34bn (£3.87bn), the EU also looking to change the way that Google conducts its business in Europe.
The penalty is the same amount the Netherlands contributes to the EU budget every year — is far higher than any other dished out by the U.S, Chinese or other antitrust authorities.
Alphabet generated about the same amount of money as the record penalty every 16 days in 2017, based on the company’s reported annual revenue of $110.9 billion for the year.
Alphabet shares were down 0.5 percent in pre-market trading in New York on Wednesday.
The EU first opened its investigation into Android in 2015, two years after receiving a complaint from FairSearch.
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