Google fined $177M by South Korea for abusing smartphone dominance
South Korea fined Google 207.4 billion won (US$177 million) on Tuesday for leveraging its dominant power in the smartphone market to stunt development of competing operating systems.
South Korea's antitrust watchdog, the Korea Fair Trade Commission, in its decision took aim at Google's anti-fragmentation agreements, which restrict handset manufacturers like Samsung and LG from creating forks of the operating system, reports Bloomberg.
Google's bid to limit fragmentation of Android seeks to cap the number of publicly available forks by imposing punitive measures on manufacturers like restricting access to Google apps. The tactic has been the subject of other governmental inquiries, including a wider European Commission antirust investigation that resulted in a $5 billion fine in 2018.
In addition to the 207.4 billion won fine, the KFTC banned Google from forcing manufacturers to sign AFA contracts, the report said. Google must also modify existing contracts to fall in line with the ruling's stipulations.
"The Fair Trade Commission's action was not limited to mobile devices, but corrective measures included emerging smart device-related areas such as smart watches and smart TVs," KFTC Chairperson Joh Sung-wook said on Tuesday. "Therefore, we expect that new innovations will occur as some competitive pressures in this area are activated."
The body is also investigating Google's Play Store, implementation of in-app purchases and advertising business as part of three separate inquiries, the report said.
Late last month, Korea became the first country to pass legislation that extricates Apple and Google from profits earned by developers on their respective online marketplaces. The country's parliament voted to approve regulations that bar app store operators from requiring use of first-party payment systems, potentially upending a system that netted the tech giants an up to 30% commission rate on in-app purchases.
Read on AppleInsider
South Korea's antitrust watchdog, the Korea Fair Trade Commission, in its decision took aim at Google's anti-fragmentation agreements, which restrict handset manufacturers like Samsung and LG from creating forks of the operating system, reports Bloomberg.
Google's bid to limit fragmentation of Android seeks to cap the number of publicly available forks by imposing punitive measures on manufacturers like restricting access to Google apps. The tactic has been the subject of other governmental inquiries, including a wider European Commission antirust investigation that resulted in a $5 billion fine in 2018.
In addition to the 207.4 billion won fine, the KFTC banned Google from forcing manufacturers to sign AFA contracts, the report said. Google must also modify existing contracts to fall in line with the ruling's stipulations.
"The Fair Trade Commission's action was not limited to mobile devices, but corrective measures included emerging smart device-related areas such as smart watches and smart TVs," KFTC Chairperson Joh Sung-wook said on Tuesday. "Therefore, we expect that new innovations will occur as some competitive pressures in this area are activated."
The body is also investigating Google's Play Store, implementation of in-app purchases and advertising business as part of three separate inquiries, the report said.
Late last month, Korea became the first country to pass legislation that extricates Apple and Google from profits earned by developers on their respective online marketplaces. The country's parliament voted to approve regulations that bar app store operators from requiring use of first-party payment systems, potentially upending a system that netted the tech giants an up to 30% commission rate on in-app purchases.
Read on AppleInsider
Comments
How much separation between the regulator and the chaebols I wonder?
mind you, Google can’t pretend Android is open source then require Anti Fragmentation Agreements. On the other hand Android is more coherent because of those agreements.
I think if they fork Android, they shouldn't be able to call it Android and no Google services. Seems fair enough. Google should be able to withhold unique and expensive developments from the open source version as well.
Just Samsung and government corruption.
The only reason they did it in the first place was to change the business model so Apple couldn't sue them back into the stone age.
No profits from the OS? No way to sue us for the IP theft since there were no profits.
In fact, many Apple fan will not even know what this ruling is actually about, except it has to do with Google and Android and nothing to do with Apple and iOS.
That is the way it is. If a mobile device maker uses a fork of open source Android, they can not call their device an "Android device". Neither can they use that green robot logo when marketing their device. "Android" and that green robot are trademarks of Google and can only be use on devices running Google licensed version of Android.
Devices that runs on an open source Android fork can only be labeled as a device that runs on Android.
Any fork of open source Android do not come with any of the Google services. Like the Google Play Store, Google map, gmail, Google Photo, gCloud, Google search, etc.. In order for a device maker to install those services, they have to pay Google for a license. Then they can call their device an Android device and use that green robot logo. Plus there is no guarantee that any device running on an open source fork of Android, will run any of the Google services if side loaded. Though many services do work. But no support from the device maker or Google.
https://arstechnica.com/gadgets/2018/07/googles-iron-grip-on-android-controlling-open-source-by-any-means-necessary/
Amazon tablets uses a fork of Android. Amazon do not call their Amazon tablet an Android device. Nor use that green robot logo.And do not come with any Google services installed. But many have side loaded Google Play Store into their Amazon tablet and say that for the most part, it works. But it might have to be side loaded again after Amazon update their Android fork. Much like jailbreaking.
It's Google that is allowing the forks of open source Android. No one if forcing Google to do this. Microsoft does not allow anyone to fork Windows.
The problem is that Google do not allow any device maker to market a device using a fork of open source Android, if they also market a device running the Google license version of Android. Samsung is not allow to market a phone using a fork of open source Android because they sell phones that uses the Google license version of Android. The license version of Android comes with the Google Play Store installed and support all of Google services.
LG was going to make the Fire tablet for Amazon, that runs on a custom fork of open source Android, but had to drop out because they were selling phones and tablets that had the Google license version of Android. They didn't want to risk losing that license by also making a device for Amazon, that was going to use a fork of open source Android. This is what Google is getting in trouble for.
It's like how Microsoft got in anti-trust trouble when they prevented PC makers from selling computers with Linux, by threatening to cancel their Windows license.
Here's a nice but long article detailing how Google controls Android. Both their license version and their open source version.
https://arstechnica.com/gadgets/2018/07/googles-iron-grip-on-android-controlling-open-source-by-any-means-necessary/