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Tech giant Google has agreed to pay a penalty of AU$55 million (US$36 million) after admitting to arrangements that restricted competition in Australia’s mobile search market.
The Australian Competition and Consumer Commission (ACCC) revealed that between December 2019 and March 2021, Google entered into exclusive agreements with telecom operators Telstra and Optus. Under the deals, only Google’s search engine was pre-installed on Android smartphones sold through the two carriers.
In return, the carriers received a share of advertising revenue generated from the default search service. According to the ACCC, this arrangement was likely to have substantially lessened competition, potentially limiting consumer choice and driving higher costs.
Regulator’s Statement
ACCC Chair Gina Cass-Gottlieb emphasized the seriousness of the conduct:
“Conduct that restricts competition is illegal in Australia because it usually means less choice, higher costs, or worse service for consumers.”
The regulator confirmed that Google cooperated fully with the investigation and accepted responsibility for its actions. The case has now been referred to the Federal Court, which will determine whether the agreed penalty and related orders are appropriate.
Google’s Response
In response, Google stated that it was “pleased to have resolved the regulator’s concerns” and clarified that such exclusive provisions had not been included in contracts for some time. A company spokesperson added:
“We are committed to providing Android device makers more flexibility to preload browsers and search apps.”
Telstra and Optus Commit to Compliance
The ACCC also noted that both Telstra and Optus signed court-enforceable undertakings last year, pledging not to enter into new deals that would pre-install Google search as the default on Android devices. This move is intended to ensure greater competition and consumer choice in the mobile search market.
Implications for Consumers and Industry
The case highlights ongoing scrutiny of tech giants’ influence in digital markets, particularly regarding pre-installed software and default search engines. By enforcing competition laws, regulators aim to protect consumers, encourage innovation, and ensure a level playing field for rival services.
As Google implements changes and complies with court orders, Android users in Australia are expected to benefit from more options for browsers and search services, while telecom operators gain the freedom to negotiate arrangements that prioritize consumer choice and competitive pricing.
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