Google to charge smartphone makers for Google Play in Europe

Google to charge smartphone makers for Google Play in Europe

Lindsey Duncan
October 17, 2018

Google is preparing for a major shift to its business model in response to a record-breaking European Union fine this summer over the rules that Google binds Android handset makers to if they want access to the OS - rules that include requiring those handset manufacturers to set Google's own search and web browsers as the default offerings. We'll be working closely with our Android partners in the coming weeks and months to transition to the new agreements.

Mobile industry executives have generally thought that Europeans have little interest in devices without Google apps.

Google has appealed the decision, arguing that the EU's accusations were unfounded, but on Wednesday said it would comply with the decision in order to avoid further fines. Android device makers could turn to other search engines, including lesser-known ones such as Qwant and DuckDuckGo, which tout their strict privacy practices. Android itself will remain free, as will Chrome as it is bundled with the Google Search app, but everything else will be chargeable. The EU Competition Commissioner gave Google 90 days to act upon the ruling. "As before, competing apps may be pre-installed alongside ours", added Hiroshi Lockheimer, senior vice president of platforms and ecosystems at Google. In addition, Google was fined a huge $5 billion for antitrust violations. The options will become available on October 29, 2018, for all new smartphones and tablets launched in the EEA. First, device makers had to include bundle of other official Google apps (Search, Chrome, Translate, Maps, etc.), and they had to agree not to ship unapproved forks (modifications) of the Android OS. Google is also going to sell a separate license for Android device makers that want to use Google Search and Chrome but pair those with services from Google competitors.

It said the requirement that some manufacturers preinstall Google applications as a condition for licensing the Google Play store, as well as the payments made to other, larger phone makers and operators for pre-installing the Google search app on devices were helping to cement the company's search leadership.

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Google has not announced what the fee structure will be, but it will only apply for devices that are intended for sale in the 31 member countries of the European Economic Area.

From a customer perspective, it's not likely that much will change here unless European smartphone makers decide to pass these new costs on to their customers.

And as a result of that sudden disappearance of revenue, Google is unwilling to let Android manufacturers use Gmail, Google Play, Maps, and so on, for free, so it will charge a fee for including that code.