Microsoft and Allies Add Android OS to Antitrust Complaints in Europe

By Peter Bernstein April 09, 2013

It may be “good to be the king,” but with great power comes the associated challenge of everyone wishing to undermine your desires, whether malicious or well-intentioned. Such is the case of Google’s continuing sharp elbows relationship with competitors and regulators in Europe. 

The European Commission (EC), the regulatory arm of the European Union, which is currently mulling over if Google is in violation of EC antitrust rules because of its domination of search, just got an ear full from the lobbying group FairSearch, concerning fears that if Google is not reigned in its Android operating system, the dominant OS on mobile devices in Europe will be used as a “Trojan Horse” for Google apps that will force users to choose a variety of other Google capabilities. 

Talk about piling on.

Microsoft is a leader of FairSearch, a coalition of 17 mostly search and tech companies including Oracle, Nokia, Expedia, Hotwire and a few other household brand names. The group’s mission is to “promote economic growth, innovation and choice across the Internet ecosystem by fostering and defending competition in online and mobile search. We believe in enforcement of existing laws to prevent anticompetitive behavior that harms consumers.”

They say they believe in two essential principles: transparency which translates into consumer choice, and innovation which is another way of saying the promotion of fair competition. Let’s just say if you visit their website, they don’t mince words, and this latest broadside is no exception.

FairSearch head Thomas Vinje stated, "We are asking the Commission to move quickly and decisively to protect competition and innovation in this critical market…failure to act will only embolden Google to repeat its desktop abuses of dominance as consumers increasingly turn to a mobile platform dominated by Google’s Android operating system."

You have to admire the FairSearch crowd for expanding their global frontal assault on Google. In fact, if you have not had the opportunity you might wish to peruse their paper, “Global Scrutiny: Law Enforcement Agencies Around the World are Investigating Google,” it is a great read as these types of things go. 

If you’re going to go after Google, why not question both of its crown jewels, search and Android?

The problem the EC has to face is trying to discern where the public interests really lie as opposed to the hot rhetoric coming out of some not disinterested members of the industry who are not happy about losing market share to Google. Microsoft in particular is an interesting example, considering its own history with the bundling of Internet Explorer (which Google Chrome has humbled) and its various problems on other antitrust issues with the EU in the past. 

And did I mention Oracle and Java? 

What will be interesting to watch as the EC deliberates all of this is the credence they give the notion that rational consumers will always act in their own self interest, and as history has shown, can use Windows as their OS, Chrome as their browser and for search. Where regulators decide to set the bar as to when there is an illegal tie-in that forces choice rather than creates options is a moving target, but one that needs to be addressed. 

Deciding what does or does not inhibit innovation is really interesting as well. I’m not a huge fan of a lot of the things Google the company does, but I am an admirer of their ability offer innovative capabilities that I continue to evaluate and choose as my preference for doing things, and think policy makers do need to be circumspect as to how they might wish to shackle the company and possibly deflect it away from investing in areas where their contributions can be significant.

What will the EC do? Great question, though it’s impossible to predict. It’s equally difficult to predict whether there will be contagion, i.e., other regulators around the world especially in the U.S., even considering this as a problem that needs their attention. 

 The truth is that, at least in the case of Android, Google may have the OS, but the Android ecosystem is vibrant, diverse and as much as Google might wish to dominate it there are certainly big players who are not going to take a real attempt of Google domination lying down. Just look at all of the intellectual property challenges and who is suing who over what for confirmation, and reflect for a moment on the Facebook Home announcement of a few days ago.  In two words, “Stay Tuned.”

Edited by Braden Becker
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