The European Union and Google

Research Articles related to this topic and use them as reference in your responses to the following questions:

1. Is the European Commission justified in its case against Google? Why or why not?
2. Why are the actions of institutions like the European Commission important to the function of markets?
3. How does the European Commission protect consumers?

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In June 2018, the European Commission announced that it had imposed a record 4.3 billion fine on Google for anticompetitive behavior (just over $5 billion). The antitrust case against Google involved Android, the mobile phone operating system created by Google, and all sorts of related software, including Google Play, its app store, a suite of other apps, and most significantly, Google's Internet search engine.

Android is the dominant mobile phone operating system in the EU with a market share of over 70 percent (Apple's iOS operating system has much of the rest). Moreover, the Google search engine completely dominates the EU market with a 97 percent share. For smartphone makers and telecom operators, Android's dominance makes Android a must-have operating system. According to the Commission, Google used its Android dominance to give smartphone makers and telecom operators an all-or-nothing choice: If they want to install any of Google's programs on an Android device, they have to install them all and show the icons in prominent positions. Because these firms have to, at a minimum, install the app store application to make their phone viable, they effectively have no choice but to comply with Google's demandsmeaning they have to install Google's Internet search engine app in a prominent position, whether they want to or not.

The Commission believes that this bundling practice denies producers of rival programs "the chance to innovate and compete on the merits" and "consumers the benefits of effective competition." Put differently, the aim of the all or nothing choice is to protect Google's programs, and most notably its dominant search engine, from competition.

The Commission has left it to Google to comply with its findings, requiring that the company rectify its infringements by ending the all-or-nothing choice. In theory, this will give rivals a better chance of selling their own apps for Android that might compete with Google's Internet search app, Google play, Google Docs, and the like. If Google does not comply, the Commission has indicated it will impose further fines on Google, amounting to up to 5 percent of the daily worldwide revenue of Alphabet, Google's parent.