US: FTC to look closely at EU’s US$5b Google fine

The Federal Trade Commission (FTC) Chairman Joseph Simons told lawmakers Wednesday, July 18, that he will look at the European Union’s move to fine Google US$5 billion for antitrust violations pertaining to the Android mobile operating system.

Reuters, citing comments Simons made during a hearing in front of lawmakers, reported the FTC head said he spoke with European Competition Commissioner Margrethe Vestager about the fine earlier in the week. “We’re going to read what the EU put out very closely,” Simons told a subcommittee of the House of Representatives Energy and Commerce Committee, according to Reuters. When asked about the control Google and Apple have over the smartphone industry, Simons said that markets that are dominated by a small number of companies are where antitrust issues often arise. “There are the two of them, so they compete pretty heavily against each other,” said Simons, according to Reuters.

The EU fine stems from an inquiry by antitrust regulators at the European Union into whether or not Google abused its position with the Android OS, which is on more than 80% of the smartphones around the globe, by favoring its own mobile apps and services including its search engine. Google has the right to appeal the fine. Google argues that its OS, which manufacturers don’t have to pay to install on mobile devices, actually boosted competition among smartphones and resulted in lower prices. It also said the allegation that it hurt third-party apps by highlighting its own is untrue because manufactures install all sorts of apps on the devices and consumers have the option to download any apps they want.

Last year the EU fined Google €2.4 billion when EU officials determined Google cooked its search results so as to benefit its own shopping services, and disadvantage the services of others. Apart from the hefty fine, the EC gave Google 90 days to “stop its illegal conduct” and offer other price comparison services the chance to compete on a balanced playing field. “Google’s strategy for its comparison-shopping service wasn’t just about attracting customers by making its product better than those of its rivals,” said Vestager said at the time. “It denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services.”

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