Smartphones will become expensive due to Competition Commission of India order, says Google

Smartphones which function on the Android operating system would become expensive as a result of the Rs 1,337.76-crore penalty and other regulations imposed by the Competition Commission of India on Google, the technology company said on Friday, Reuters reported.

In October, the Competition Commission of India had imposed the penalty on Google for “abusing its dominant position” in multiple markets in the Android mobile device ecosystem. Android is an operating system that runs applications and programs on smartphones.

The penalty had been imposed following an inquiry, which the competition regulator had ordered against Google in 2019 after it received complaints from consumers about its Android smartphone agreements. Google has filed an appeal against the order.

On January 4, the National Company Law Appellate Tribunal refused to put an interim stay on the fine and ordered Google to deposit 10% of the penalty amount before the next hearing on the plea on February 13.

On Friday, Google said in a statement that due to the Competition Commission of India order, the company would have to change how it does marketing of its Android platform. This will increase the cost for app developers, equipment makers, and consequently, consumers, the company said, according to Reuters.

It has also warned that the regulations imposed by the competition regulator, besides the penalty, could lead to use of unchecked apps that could pose threats to user and national security, The Indian Express reported.

“Predatory apps that expose users to financial fraud, data theft and a number of other dangers abound on the internet, both from India and other countries,” the company said. “While Google holds itself accountable for the apps on Play Store and scans for malware as well compliance with local laws, the same checks may not be in place for apps sideloaded from other sources.”

The case

In its order, the Competition Commission of India had said it found that pre-installation of the entire Google Mobile Suite – a collection of Google applications – was mandatory in Android smartphones and users had no option to uninstall it.

“Their [the applications] prominent placement amounts to imposition of unfair condition on the device manufacturers and thereby contravenes competition law,” the antitrust body had said.

It said that the most prominent search entry points in smartphones such as the search apps, widgets and web browser Chrome – also developed by Google – are pre-installed on Android devices that gives the technology company a significant competitive edge over its competitors.

In its appeal against the order at the National Company Law Appellate Tribunal, Google had argued that the competition regulator order is a “copy-paste” of a 2018 European Commission order that had imposed a fine of 4.1 billion euros (over Rs 35,963 crore) on Google for allegedly imposing unlawful restrictions on Android mobile device makers.