Europe slams Google with a record $7.4 billion antitrust fine

The Google Inc. logo on the company's exhibition stand at the Noah Technology Conference in Berlin last month

The Google Inc. logo on the company's exhibition stand at the Noah Technology Conference in Berlin last month. Credit Krisztian Bocsi Bloomberg

The fine, which was to be announced about midday on Wednesday, ends an European Union probe into Google's contracts with smartphone manufacturers and telecommunications network operators.

Meanwhile, Google has 90 days to "bring its illegal conduct to an end", and stop the three antitrust practices the Commission highlighted (tying Google search and browser apps, illegal payments for Google Search app exclusivity on Android devices, and illegal obstruction of development and distribution of competing Android-based operating systems).

The European Commission fine will exceed last year's then-record 2.4 billion-euro penalty following an investigation into Google's shopping-search service.

The European Commission found Google had used Android, the most popular mobile software globally, to reinforce its own dominance in search.

"These practices have denied rivals the chance to innovate and compete on the merits", she continued.

"At a minimum, Google has to stop and to not re-engage in any of the three types of practices", the European Union said in a press release.

The decision comes just over a year after the Commission slapped a landmark €2.4 billion penalty on Google, a unit of Alphabet Inc, for favouring its shopping service over those of competitors. Its representatives did not respond to requests for comment on Wednesday.

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Google immediately said it would appeal the massive fine. "Google can not have its cake and eat it", said Vestager. "Today's decision and fine are a logical outcome, as this is a clear anticompetitive behavior to me". It also notes that Google "made payments to certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices".

Vestager said: "Today, mobile internet makes up more than half of global internet traffic". Regulators have also alleged that Google sought to prevent manufacturers from using alternatives to its Android operating system.

Google is now appealing against that decision.

The EU's Competition Commissioner Margrethe Vestager is set to announce a 4.3-billion-euro ($5 billion) penalty against the U.S. tech giant, according to Bloomberg News. Android's code is open-source, meaning it can be tweaked and edited by device manufacturers.

Google argued that restrictions on Android forks were necessary to prevent "fragmentation" of the Android ecosystem, but the Commission assessed these arguments to be "not well-founded".

The commission began investigating Android after a complaint was lodged by Fairsearch, a trade group that originally included Microsoft, Nokia and Oracle among its members.

"Today's decision rejects the business model that supports Android, which has created more choice for everyone, not less".

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