Google has been dealt a blow in its ongoing battle with European regulators — the Internet giant has lost its anti-monopoly appeal in Russia.
The Moscow Arbitration court has upheld a previous ruling from the Federal Antimonopoly Service (FAS) that found Google had abused its dominant market position and broken anti-competition legislation. The crux of the complaint was that Google hindered the ability to create competing services on Android by forcing manufacturers to bundle some Google apps, including Gmail, Google Search, and Google Play, on the phones.
While manufacturers are free to use Android without the aforementioned apps installed, if they wish to offer one of the aforementioned services, they have to offer them all.
Local competitor Yandex made the original complaint to the FAS regarding Google’s purported insistence that Android phones come with certain Google apps out of the box. For example, if a phone manufacturer wants to offer users the Google Play app store, they also have to offer Google Maps, Gmail, and Google Search. It’s the latter of these services that would have been of particular annoyance to Yandex, given it runs its own competing search business in Russia.
A Yandex spokesperson told VentureBeat:
After careful consideration of all the facts in the case against Google’s anticompetitive practices, the court has upheld FAS’s judgement. We are satisfied with the court’s decision to uphold FAS’s judgement in the case against Google.
Google may now have to rewrite its contracts with manufacturers to allow them to cherry-pick which apps they install out of the box, and maybe pay a fine, as per the initial FAS ruling. The court-issued statement reads:
In course of the case proceedings, the Commission of the FAS Russia found that Google provided mobile devices manufacturers with Google play app store for pre-installation on Android OS mobile devices adopted for the Russian Federation. Conditions of app store provision include obligatory pre-installation of Google apps as well as its searching engine and their obligatory location on the main screen of a mobile device.
Google actions led to prohibition of pre-installation of apps of other producers.
While the news from Russia will no doubt be greeted with dismay by Google, it could signal the start of a great unbundling of Android across the broader European region. Indeed, Google’s Android woes extend across into the European Union (E.U.) with the European Commission (E.C.) also probing Google along similar grounds.
When it announced this probe last year, the Commission said it would assess:
If, by entering into anticompetitive agreements and/or by abusing a possible dominant position, Google has illegally hindered the development and market access of rival mobile operating systems, mobile communication applications and services in the European Economic Area (EEA).
After a four-year investigation into the matter, Europe is also accusing Google of using its dominance to bias search results. And a number of countries, including the U.K., are pushing the U.S. company to pay more local tax.
While Russia’s ruling won’t necessarily have any bearing on the broader E.U. findings, Google and its parent company, Alphabet, are growing increasingly concerned about events across the Atlantic and have been investing heavily in lobbying efforts.