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Google Facing Antitrust Scrutiny In California Over App Bundling

December 18, 2014 - Written By Jeremiah Nelson

Google is facing antitrust regulation in Europe and now they’re trying to head off an antitrust suit in the U.S. A lawsuit in San Jose California claims that Google is trying to squeeze out competition, like Bing Search, by requiring manufacturers like Samsung and LG to preload Google apps on their devices. The two plaintiffs in the case state that consumers don’t know how to change different default apps, or they are just too lazy to look for alternatives. Google says there’s no anti-competitive happening because consumers still have plenty of choices. This is essentially the same case that was brought against Google in the EU about their Search product. The EU ruled that Google must be broken up and passed a non-binding resolution that asks antitrust authorities to actually break up Google in Europe.

The class action suit that is being proposed in California has broader implications because of the action that the EU is looking to take against Google in Europe. Google is subject to an investigation in Europe that could last as long as four years, to determine is they also ranked their own search results higher than those of competitors to try to gain an edge in the marketplace. This investigation is just about Google Search, but Microsoft and other Google competitors have also petitioned the EU to look into Google’s practice of requiring manufacturers to ship Android devices pre-loaded with Google apps. The complaint that Microsoft and others filed states that Google’s apps are “widely used on Android by requiring default placement and other mechanisms for disadvantaging competing apps.”

This same kind of scrutiny landed Microsoft in hot water in the late 90s, for bundling Internet Explorer with Windows. Competitors said it didn’t let them compete in any meaningful way because consumers simply use what is included for them. There is an element of truth to this and to the claims being made in the potential class action suit in California. IE held a dominant market share for a long time, simply because Windows users didn’t go out and find another web browser. Whether you think Google is acting in a matter that is anti-competitive or not, this certainly sounds like it needs to be scrutinized.