Google Guilty Of Abusing Its Mobile Search Dominance In Russia - InformationWeek

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9/15/2015
04:05 PM
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Google Guilty Of Abusing Its Mobile Search Dominance In Russia

There are more antitrust woes for Google. This time they're in Russia, where the company could face unspecified fines or contract renegotiations with OEMs.

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10 Google Milestones: From Stanford Dorm To Alphabet
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Google's international legal woes continue. The search giant was found guilty of breaking Russian antitrust laws, according to a report in The Wall Street Journal.

Russia's antitrust regulator told the Journal that Google was found guilty of abusing its position of market dominance, but had not been found guilty of "unfair competition practices."

The Russian Federal Antimonopoly Service now has a little more than a week to issue its full and final ruling after opening up a probe in February that investigated Google's packaging of applications into its Android mobile operating system.

The probe was opened after Yandex, known as the Google of Russia, filed a lawsuit that same month.

While Yandex claims 60% of the search engine marketshare in Russian, its percentage drops to 40% when it comes to mobile search, which is growing thanks to the proliferation and popularity of smartphones and tablets.

(Image: dolphfyn/iStockphoto)

(Image: dolphfyn/iStockphoto)

Android mobile devices constitute 86% of smartphones and tablets in Russia, which led Yandex to claim it was unfair of Google to disallow competing apps to be installed on devices it did not make.

In 2013, Yandex became the world's fourth most popular search engine, overtaking Microsoft's Bing platform, according to a figures from comScore qSearch.

"We believe that device manufacturers should have a choice as to which search provider to set as the default or which services to have preinstalled on the device. Google should not prevent manufacturers from preinstalling competitor apps," Yandex spokesperson Ochir Mandzhikov said in February. "This is why we are talking about the need to unbundle Google's Android operating system from Google Search and its other end-user services."

If the final ruling comes down against Google, it may face fines or be forced to alter its agreements with device manufacturers in the country.

"The EU is a much bigger market for Google and their market share is much larger there so you have to take those comments more seriously than Russia's," Ken Sena, an analyst at Evercore ISI, told the Journal. "For Yandex this is probably more of an event than for Google."

[Read more about Google's problems with the FTC.]

Google's search woes extend to the European continent as well, as it continues to battle antitrust charges brought on by the European Commission, which date back to 2010.

In April, the European Commission formally accused Google of abusing its dominant position in the online search market and announced an investigation into the company's Android mobile operating system.

Margrethe Vestager, EU Commissioner for competition policy, said in a statement that she was concerned Google has given an unfair advantage to its own comparison shopping service, Google Shopping, to the detriment of rivals.

However, Google has insisted that its conduct has been lawful and beneficial to the market. In an April post on the Google Europe blog, Hiroshi Lockheimer, vice president of engineering for Android, said that Android has led to increased competition, improved choice, and reduced prices.

Nathan Eddy is a freelance writer for InformationWeek. He has written for Popular Mechanics, Sales & Marketing Management Magazine, FierceMarkets, and CRN, among others. In 2012 he made his first documentary film, The Absent Column. He currently lives in Berlin. View Full Bio

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danielcawrey
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danielcawrey,
User Rank: Ninja
9/16/2015 | 2:28:38 PM
Rules
The rules and regulations in Russia and the EU reflect that both of those regions feel uncomfortable with the overall size of Google.

The company's dominance over local rivals is making regulators uncomfortable there, which is unlike the US, where Google has a comfortable lead in many areas like search and mobile. 
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