June 28, 2019 / 12:24 PM / 4 months ago

Exclusive: Google appears to have leveraged Android dominance - India watchdog

NEW DELHI (Reuters) - Google (GOOGL.O) appears to have misused its dominant position in India and reduced the ability of device manufacturers to opt for alternate versions of its Android mobile operating system, Indian officials found before ordering a wider probe in an antitrust case.

FILE PHOTO: The Google logo is pictured at the entrance to the Google offices in London, Britain January 18, 2019. REUTERS/Hannah McKay/File Photo

A 14-page order from the Competition Commission of India (CCI), reviewed by Reuters this week, found Google’s restrictions on manufacturers seemed to amount to imposition of “unfair conditions” under India’s competition law.

Reuters reported last month that the CCI had launched a probe in April against Google for its alleged abuse of Android’s dominant position to block rivals, but the contents of the directive detailing the initial assessment upon which that investigation was ordered have not been previously revealed.

The Indian case is similar to one Google faced in Europe, where regulators imposed a $5 billion fine on the company for forcing manufacturers to pre-install its apps on Android devices. Google has appealed against the verdict.

By making pre-installation of Google’s proprietary apps conditional, Google “reduced the ability and incentive of device manufacturers to develop and sell devices operated on alternate versions of Android”, the CCI said in the order. “It amounts to prima facie leveraging of Google’s dominance”.

Asked for comment, Google referred Reuters to its statement last month, in which it said Android had enabled millions of Indians to connect to the internet by making mobile devices more affordable. Google looked forward to working with the CCI “to demonstrate how Android has led to more competition and innovation, not less”, the company said at the time.

The CCI did not respond to a request for comment.

While the order, dated April 16, called for a wider probe against Google, the watchdog’s investigations unit could still clear Google of any wrongdoing.

The amount of any fine that could be imposed on Google if the CCI rules against it was not clear.

ANDROID DOMINANCE

Android, used by device makers for free, features on about 88 percent of the world’s smartphones. In India, about 99 percent of the smartphones sold this year used the platform, Counterpoint Research estimates.

In the EU case, regulators said Google forced manufacturers to pre-install Google Search and its Chrome browser, together with its Google Play app store, on Android devices, giving it an unfair advantage.

In the Indian case, Google argued that Android was an open source platform and pre-installation obligations were “limited in scope”, the CCI order said.

The CCI said that complainants in the Indian case - which according to sources involve more than one person - have alleged that Google engaged in abusive behavior similar to the kind outlined in the European case. They said Google was engaged in anti-competitive practices “with the aim of cementing Google’s dominant position”.

Google’s “impugned conduct may help perpetuate its dominance in online search markets while resulting in denial of market access for competing search apps”, the CCI said in its order.

The investigations arm of the CCI should complete the wider probe in the case within 150 days, the order said, though such cases at the watchdog typically drag on for years.

The CCI also said the role of any Google executive in alleged abuse of the Android platform should also be examined.

The investigation is not the only antitrust headache for the Mountain View, California-based company in one of its key growth markets. Last year, the CCI imposed a fine of 1.36 billion rupees ($20 million) on Google for “search bias” and abuse of its dominant position.

Google appealed against that order, saying the ruling could cause it “irreparable” harm and reputational loss. That appeal is still pending in an Indian tribunal.

Reporting by Aditya Kalra; Editing by Martin Howell and Alex Richardson

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