Google hit with $5bn Android fine from EU

Google hit with $5bn Android fine from EU

Troy Powers
July 20, 2018

WASHINGTON-President Donald Trump said on Thursday that the European Union's $5 billion antitrust fine on Alphabet Inc.'s Google is evidence that the bloc has "taken advantage of the US", and suggested that change is on the way.

"I told you so!" he said.

It is likely to stoke tensions between Europe and the USA, which regulates the tech industry with a lighter hand and has complained that the European Union is singling out American companies for punishment.

Google later said it is planning to file an appeal against the decision, arguing that around 40 apps from multiple developers are pre-installed on typical smart devices, not just by Google, and the Commission ruled out competition between Android and iOS operating systems.

The decision, which followed a three-year EU investigation, comes as fears of a transatlantic trade war mount because of President Donald Trump's decision to impose tariffs on European steel and aluminum exports.

The new sanction almost doubles the previous record European Union anti-trust fine of 2.4 billion euros, which also targeted Google, in that case for the Silicon Valley titan's shopping comparison service in 2017.

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The EU has given Google 90 days to makes changes to its practice, failing which the search engine giant will be slapped with daily fines of 5% of its annual revenue. "A vibrant ecosystem, rapid innovation, and lower prices are classic hallmarks of robust competition", CEO Sundar Pichai has also suggested that the ruling will mean that Android will no longer be offered for free. In the post, Google took a firm stand for itself and said that Android has helped 1,300 different smartphone manufacturers to develop Android-based mobiles.

The EU says Android is used on around 80 percent of mobile devices, both in Europe and worldwide.

It represents just over two weeks of revenue for Google parent Alphabet and would scarcely dent its cash reserves of $102.9 billion.

The fine was issued over what the European Union describes as "illegal practices" over how the internet giant implements its search and web browser apps on the devices of Android smartphone makers.

Previous year eMarketer forecast almost $50billion would be made by Google in 2017 from mobile ad revenue.