Nothing is free, not even Android: EU fines Google $5.1 billion
This morning, the European Union (EU) Commission hit Google with a $5.1 billion antitrust fine, ruling that the company was strong-arming phone makers into adopting Android — a free operating system — with heavy costs. The EU alleges Google pressured phone makers into making Google search and Chrome native on devices in order to have access to Google Play, a necessary tool if users want to download any other app at all. Some companies got financial rewards for pre-installing these tools, according to the suit, and this ecosystem allowed Google deeper, more ubiquitous access to an enormous body of users and their most intimate data.
$5.1 billion is a huge amount of money, but by no means a damning sentence for a company worth $131 billion. Google has argued that by distributing the Android platform for free, smartphone makers are able to offer their own phones at a lower cost. This feedback system has lead to total dominance of the smartphone market for Google: It holds about 86 percent, while iOS, its closet competition, holds about 14 percent. In a blog post published today, Google CEO Sundar Pichai argued that the EU’s decision was unjust partially because Android competes with iOS.
The real, long-term question is whether Google will have to make any adjustments to the way that Android works, or monetize user data in a different way, in order to keep profits high. Other than advertisements, Google makes money off a series of interconnected services that keep users reliant — even when using those services means compromising email security.
Google is supposed to end discriminatory Android practices within 90 days, but it’s unclear how or whether this will happen. On Twitter, Google announced that it plans on appealing the EU Commission's decision, a process that could take years. Last year, Google was hit with a $2.7 billion fine for unfairly herding users toward its own shopping platform. Google appealed that decision as well, delaying the process.