Time to dig deep.
Alphabet Inc. (GOOGL) , the parent of internet search giant Google, was fined a record $5 billion by European antitrust authorities Wednesday following a lengthy investigation into contracts that tie makers of android-operated smartphones to the exclusive sale of its apps.
Google, which was fined a then-record €2.4 billion by the European Competition Commission for denying "other companies the chance to compete on the merits and to innovate" in the market for price comparison searches on its website, could face billions more in levies for allegedly compelling smartphone makers to take Google services, including its web browser, when they want licensing access to the Google Play store. The €4.34 billion fine, confirmed in a press conference in Brussels by EU Competition Commissioner Margrethe Vestager, is the largest in EU history but falls short of the $11 billion reported last month by Britain's Financial Times.
"Our case is about three types of restrictions that Google has imposed on Android device manufacturers and network operators to ensure that traffic on Android devices goes to the Google search engine," Vestager said. "In this way, Google has used Android as a vehicle to cement the dominance of its search engine. These practices have denied rivals the chance to innovate and compete on the merits."
"They have denied European consumers the benefits of effective competition in the important mobile sphere," she added. "This is illegal under EU antitrust rules"
Google shares were seen 0.67% lower in pre-market trading in New York, indicating an opening bell price of $1,205.00 each, a move that would trim its year-to-date gain to just over 15%.
Google has said it will appeal the Commission's fine, arguing in a statement that Android has created more, not less, choice for smartphone customers.
"Android has created more choice for everyone, not less," Google spokesman Al Verney told Reuters. "A vibrant ecosystem, rapid innovation and lower prices are classic hallmarks of robust competition. We will appeal the Commission's decision."