CCI orders investigation into abuse of dominance allegations against Google

On April 16, 2019, CCI ordered an investigation into the information filed by three consumers of Android based smartphones in India, namely Mr. Umar Javeed, Ms. Sukarma Thapar and Mr. Aaqib Javeed (‘Informants’) against Google LLC and Google India Private Limited (collectively, referred to as ‘Google’).[1] The allegations in the information were under Section 4 of the Act and related to Google’s Android operating system, which is an open-source, mobile operating system (‘Android OS’) installed by original equipment manufacturers of smartphones and tablets (‘OEMs’).

The key allegations in the information related mainly to two agreements, i.e., the Mobile Application Distribution Agreement (‘MADA’), and the Anti Fragmentation Agreement (‘AFA’), which were entered into by the OEMs of Android OS with Google. Under the AFA, OEMs were restricted from developing and marketing the incompatible modified version of Android OS, Android forks, on other devices, which is alleged to restrict access to potentially superior versions of Android OS. AFA is a pre-condition to signing the MADA. It was further alleged that while signing the MADA is optional, OEMs are required to pre-install Google’s own applications in order to get any part of Google Mobile Services (‘GMS’), i.e., Google applications like Maps, Gmail and Youtube, thereby hindering development of rival applications.

For the purpose of assessment, CCI prima facie delineated the following relevant markets: ‘market for licensable smart mobile device operating systems in India’, ‘app stores for android mobile operating systems’ and ‘general web search service’ and found Google to be prima facie dominant in these markets. Separately, CCI also noted that each application like online hosting platform, browser, map, could be a separate relevant market.

CCI issued an order under Section 26(1) of the Act, instructing the Director General (‘DG’) to investigate Google on the allegations made in the information, based on the following factors:

i.       AFA: According to CCI, conditions under the AFA, prima facie seem to reduce the ability and incentive of OEMs to develop and sell alternative versions of Android OS, in contravention of Section 4(2)(b) of the Act, i.e., limiting technical or scientific development relating to goods and services to the prejudice of consumers; and

ii.     MADA: According to CCI, conditions under the MADA, i.e., mandatory pre-installation of GMS suite, prima facie seem to amount to imposition of unfair condition on the OEMs in contravention of Section 4(2)(a)(i) of the Act.

[1] Case no. 39 of 2018

Published In:Inter Alia Special Edition- Competition Law - August 2019 [ English
Date: August 7, 2019