Australia’s Federal Court has order Google to pay $55 million in penalties after it found that “understandings” it entered with local telcos to preload its search engine on Android devices breached competition laws.
The court found that the understandings, struck between the search giant’s Asia Pacific subsidiary, and Telstra and Optus between December 2019 and March 2021, were anti-competitive.
The Australian Competition and Consumer Commission (ACCC), which brought the action against the search and marketing giant, said that Telstra and Optus received a share of revenue from ads exposed to consumers when they used Google Search on the handsets.
“This penalty should send a strong message to all businesses that there are serious and costly consequences for engaging in anti-competitive conduct,” ACCC deputy chair Mick Keogh said.
“Our market economy is predicated on businesses competing freely with each other, which is why locking out competing businesses in a way that substantially lessens competition is illegal.”
Google’s search service was pre-installed on Android devices and set as the default option.
The telcos were not parties to the court proceedings. When these agreements expired in 2024, Telstra and Optus did not renew them.
The ACCC said that Google cooperated with its investigation, and admitted that it had engaged in anti-competitive conduct.
When contacted for comment today, Google Australia directed iTnews to a statement it made on the matter last August.
“We’re pleased to resolve the ACCC’s concerns, which involved provisions that haven’t been in our commercial agreements for some time,” a Google spokesperson said at the time.
“We are committed to providing Android device makers more flexibility to preload browsers and search apps, while preserving the offerings and features that help them innovate, compete with Apple, and keep costs low.”
When the ACCC began proceedings against Google in August, the company agreed to a court-enforceable undertaking, committing to remove the pre-installed default search engine restriction from agreements with Android phone makers and telcos.
Telstra, Optus and TPG also entered court-enforceable undertakings, agreeing not to renew the arrangements with Google.
“Today’s outcome, combined with the undertakings from Google and the telcos, creates the potential for millions of Australians to have greater search choice in the future,” Keogh said.
“Other search tools, including those enhanced by artificial intelligence, can now compete with Google for pre-installation on Android phones.”