Microsoft, Nokia Accuse Google of Antitrust Violations in European Union

An industry consortium that includes Microsoft and Nokia in its member base has formally complained about Google’s Android mobile OS to antitrust regulators in the European Union (EU). The goal? To curb Android’s unfair dominance of the mobile industry.

“Google is using its Android mobile operating system as a ‘Trojan Horse’ to deceive partners, monopolize the mobile marketplace, and control consumer data,” says Thomas Vinje, a lawyer who represents the industry group FairSearch. “Failure to act will only embolden Google to repeat its desktop abuses of dominance as consumers increasingly turn to a mobile platform dominated by Google’s Android.”

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With 95 percent of its 2012 revenues derived solely from advertising, Google is best described as an online advertising firm. But it also dominates the online search market on traditional PCs, a dominance it has extended more recently to mobile devices. To achieve this new goal, Google provides a mobile OS called Android for free. Handset makers, wireless carriers, and other pseudo-partners have embraced this pricing model and melded Android to their own needs. This practice—essentially product dumping—helped Google’s Android achieve 70 percent market share in mobile devices by the end of 2012, FairSearch says.

From an antitrust standpoint, Google dumped Android on the market specifically to ensure that its desktop search dominance continued in the nascent market for mobile computing. And the strategy—while legally dubious—worked: Google now controls 96 percent of the market for mobile search advertising, most of it riding on the back of a product that was given away for free.

“We are asking the European Commission to move quickly and decisively to protect competition and innovation in this critical market,” Vinje added.

Moving quickly isn’t part of the EU playbook. But European Commission (EC) antitrust regulators have at least proven to be less squeamish than their US counterparts when it comes to taking Google to task. The firm is currently negotiating a settlement in Europe over its search business, whereas the US Department of Justice (DOJ) essentially passed on the same complaints. Hopefully the FairSearch complaint—which includes 17 tech companies—will incite more action from the EU.

“We are concerned by the possibility of abuse,” EU competition commissioner Joaquín Almunia said recently of Google. It’s time to prove it, Mr. Almunia.

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