EU Fines Google $5 Billion
NOEL KING, HOST:
The European Union is fining Google $5 billion for violating antitrust laws. The EU says the company unfairly games the system by making Android smartphones come equipped with Google products as the default software. This is the largest fine ever levied by the EU. And it is worth noting that just last year the EU fined Google $2.7 billion for similar reasons. Mark Scott is chief technology correspondent at Politico Good morning, Mark.
MARK SCOTT: Good morning.
KING: All right, so we've got an antitrust fine here. What exactly are European officials taking issue with?
SCOTT: So they are taking issue on how Google uses Android. So three-quarters of people, both here in Europe and in the States, have Android-based phones. And what the European Commission is saying this morning is that Google used its Android software to promote its own dominance in regular traditional online search.
KING: And what does that look like?
SCOTT: So it means that if I'm a phone-maker - say Samsung or Huawei, the Chinese maker - if I want to use both Android and have access to Google's very popular app store, called the Play Store, I also must pre-install Google's both mobile browser called Chrome as well as Google search.
SCOTT: And the idea being - yeah, exactly. And the idea being that - Commission European officials are saying that by linking those to - having access to the Play Store with search and Chrome - that that is illegal.
KING: All right, so what does Google say?
SCOTT: Well, they obviously are refuting this and are going to appeal. In response this morning, Google's CEO has said that, you know, Android is a completely open, free-to-use software. And it believes it actually has helped competition, not hindered it.
KING: Interesting - Google not backing down. You wrote today on Twitter that not everyone will cheer this fine. You've talked to app developers who are worried. Why?
SCOTT: Yeah, so if I'm an app developer - say in California or in Croatia or anywhere else - they benefit from having a one-stop shop when it comes to Android because 75 percent of cell phones use the software. If they build an app for Android, they believe that they can then have access to a wider market. And they are concerned, at the moment, if European officials open up the software to increase competition, they'll have to do more work to make it work on different phones.
KING: They'll have to build the app for everything else.
KING: Just quickly, will this affect how Google operates in the United States? This is a fine in Europe by the European Union. Will Americans see anything different?
SCOTT: Now, that is the $64 million question right now. As part of the remedies that the European officials have demanded, they've asked Google to open up Android to greater competition - allowing other search apps and other web browsers to have a greater say. The question is will this be limited solely to Europe. Or will Google apply this to across their global ecosystem? That right now is unknown. I think Google if it can will limit this to Europe. But it might spread into other areas, including the U.S.
KING: And it's interesting to think about how U.S. regulators will respond to this. Mark Scott is chief technology correspondent at Politico. Thanks so much, Mark.
SCOTT: Thank you.
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