As you may have heard, Google got a pretty big telling off by the European Commission yesterday. 4.3 billion Euros worth in fact, which works out at around £3.8 billion. It's the largest fine the EC has ever dished out, beating the 2.3 billion Euro fine that it handed out last year (to Google again!) for manipulating search results to favour its own shopping services.
What was Google fined for this time?
This time it was nothing to do with search results but concerned abuse of its Android mobile operating system to stifle competition to its Chrome browser.
The three areas of contention were that Google:
- Requires mobile phone manufactures wishing to use Android to pre-install Google Search and Google Chrome.
- Pays manufacturers to pre-install Google Search exclusively.
- Heavily restricts the development of new open source versions of Android.
These 3 points result in fewer operating systems, browsers and search engines for consumers and thus less competition for Google.
Margrethe Vestager, the European Commissioner for Competition, said in an interview with CNBC that Google has to "stop this behaviour" and threatened further fines if the company continued.
An EC press release states:
"Google must now bring the conduct effectively to an end within 90 days or face penalty payments of up to 5% of the average daily worldwide turnover of Alphabet, Google's parent company."
After this record breaking fine, we wanted to look back at some other huge penalties meted out to other companies by the EC.
Qualcomm | Fine: €997 million, Year: 2018
On Jan 24 of this year the semiconductor and telecommunications equipment company Qualcomm was fined almost 1billion Euro. The EC stated that it was guilty of violating antitrust laws by paying Apple to secure the exclusive use of its chips in Apple smartphones and tablets.
Intel | Fine: €1.06 billion, Year: 2009
Another US computer chip manufacturer, Intel was fined back in 2009. The reason was a familiar one in the world of computer chips: for trying to exclude its main rival AMD from the market. Intel was found to have abused it's dominant market share and offered rebates to computer manufacturers for purchasing Intel CPUs exclusively. Even more damaging were revelations that the company had directly paid manufacturers such as Hewlett Packard, Acer and Lenovo to actual cancel or at least delay the consumer launch of products containing AMD products.
Microsoft | Fine: €2 billion (and growing), Year: 2004 -
Where to start with Microsoft? Google's record fine yesterday will have sounded awfully familiar to Bill Gates due to the many legal battles his company has had with the EC. Nearly all the issues are anti-competitive in nature. Starting in 2004 Microsoft was forced to release its Windows operating systems without its bundled media player software and fined €497 million for good measure. Since then various battles have been fought regarding Microsoft products such as Windows Server, Office's OpenDocument format and most famously over Internet Explorer. Microsoft were even forced into providing consumers a 'ballot box' screen which would list 12 popular browsers in a random order. This allowed a clear and informed choice.
So how will Google recover from this massive fine?
If you are feeling sorry for Google and wondering how bleak the future must look for the company, we don't think you need to worry. According to estimates it's going to take Google just 14 days to earn the cash to pay off the €4.3 billion fine.
Mike is a designer at Optima Systems. He grew up in West London and now lives by the sea. His first love was music which led to jobs in recording engineering and a number of years as a front of house sound engineer and theatre stage manager. Having been taught the basics of HTML while at university he continued to develop websites as a hobby. It wasn't long before he realised the hobby was the more rewarding pursuit. More about Mike.
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