Google fined $36 million in Australia for crushing search competition

In a significant ruling, Google has agreed to pay AUD 50 million (approximately USD 35.8 million) to Australia’s consumer watchdog following a determination that its partnership with the country’s leading telecom companies unfairly stifled competition in the search engine market. The Australian Competition and Consumer Commission (ACCC) initiated legal proceedings against Google’s Asia-Pacific division, and a federal court will evaluate whether the imposed penalty is suitable. The case centers on Google’s agreements with Telstra and Optus, which involved the exclusive pre-installation of Google Search on Android devices sold to consumers for a period of 15 months, ending in March 2021. During this time, rival search engines were excluded, allowing Google to dominate the market. In exchange for this exclusivity, the telecom operators received a portion of the advertising revenue generated from users. In a bid to rectify the situation, Telstra and Optus, along with competitor TPG, have committed to court-enforceable measures with the ACCC, ensuring they will not renew or engage in similar restrictive agreements with Google. The tech giant has acknowledged that its partnerships likely led to a “substantially lessening of competition,” as noted by the commission. ACCC Chair Gina-Cass Gottlieb emphasized the importance of maintaining competitive practices in Australia, stating, "Conduct that restricts competition is illegal in Australia because it usually means less choice, higher costs, or worse service for consumers." Gottlieb also highlighted that these changes are particularly relevant as AI-driven search technologies emerge, fostering new competition in the sector. This ruling follows a broader scrutiny of Google’s market practices, as a US federal court previously found the company guilty of monopolistic behavior through similar agreements with mobile carriers and device manufacturers. Reports indicate that Google pays Apple around USD 20 billion each year to secure its position as the default search engine on iPhones. Moreover, an Australian court has also issued a partial ruling against Google in a lawsuit from Epic Games, the creator of Fortnite, which alleges that both Apple and Google obstruct rival app stores from functioning on their platforms.