South Korea's antitrust authority fined Google 207,4 billion won, or $177 million. The reason is the abuse of Android's dominant position in the market and suppression of competition in the market of operating systems. The investigation against Google itself was launched back in 2016, and now, five years later, a verdict has been issued based on its results.
Antitrust authorities have concluded that Google has been illegally forcing hardware manufacturers to sign the Anti-Fragmentation Agreement (AFA) since 2011. Otherwise, they are deprived of early access to the Android OS, which is necessary for the development of new smartphones.
Under the terms of the agreement, manufacturers cannot install unofficial versions of Android on their devices. According to officials, this behavior has led to Google's dominant position in the operating system market and prevents healthy competition. In addition to the fine, the antimonopoly body obliged Google to abandon the practice of signing an agreement to combat fragmentation.
Another source of abuse by Google is the Google Play app store, which dominates the distribution of software for Android devices. In order not to lose access to it, manufacturers should conclude exclusive contracts with Google.
In 2013, Samsung Electronics released the original Galaxy Gear based on a fork of Android, but was forced to abandon a modified version of the Android OS after Google complained of breach of contract.
In 2011, Amazon also tried to work with LG Electronics to release a Kindle Fire tablet running a modified version of Android. But the launch never happened because LG admitted it would violate an anti-fragmentation agreement with Google.
Unfair practices helped Google strengthen its dominance in the mobile platform market. Google's operating system market share reached 97,7% in 2019, up from 38% in 2010.
Officials hope holding Google accountable will help local device makers; such as Samsung and LG are initiating OS development programs for their future devices and services. Also, the South Korean antimonopoly body expressed hope that this will help revive competition in the OS market.
This is the second major blow to Google since South Korea passed the law earlier; oblige Apple and Google to allow third-party payment systems in their app stores.
