Alphabet’s Google will pay a substantial AU$55 million (approximately US$36 million) penalty following findings by Australia’s competition regulator that it engaged in anticompetitive arrangements with the nation’s leading telecommunications providers, according to AP News.
The Australian Competition and Consumer Commission (ACCC) confirmed the settlement and initiated proceedings in the Federal Court to assess the appropriateness of the proposed penalty.
The ACCC stated that Google Asia Pacific Pte Ltd, based in Singapore, entered into agreements with Telstra Corporation Ltd and Optus Internet Pty Ltd. These arrangements, active for a fifteen-month period concluding in March 2021, ensured that only Google Search was pre-loaded as the default search engine on Android mobile devices sold to consumers by the telcos.
The effect was the exclusion of rival search engines from being factory-fitted on these handsets. In exchange for granting Google this exclusive positioning, the telecommunications giants received a portion of the advertising revenue generated through user searches conducted via Google on those specific devices.
Google formally acknowledged that the terms of these agreements were likely to have resulted in a “substantially lessening competition” within the relevant market. Alongside the financial penalty, Google has provided the ACCC with a court-enforceable undertaking.
This commitment obliges the tech firm to eliminate specific clauses concerning pre-installation and default search engine settings from its contracts with manufacturers of Android phones and telecommunications providers moving forward.
“We’re pleased to resolve the ACCC’s concerns, which involved provisions that haven’t been in our commercial agreements for some time,” Google stated in response to the settlement.
ACCC Chair Gina Cass-Gottlieb emphasised the significance of the outcome and the ongoing need for vigilance.
“Conduct that restricts competition is illegal in Australia because it usually means less choice, higher costs or worse service for consumers,” she asserted.
This settlement follows earlier regulatory actions concerning similar agreements. During the previous year, Telstra, Optus, and their competitor TPG Telecom each entered into separate court-enforceable undertakings with the ACCC.
These commitments bind them to refrain from renewing existing arrangements or establishing new agreements with Google that would impose limitations on consumer choice regarding search engine options on devices they supply.
