What They Are Saying: Chorus Of Experts Sound Alarm Over EC Decision
In reaction to the European Commission’s Android decision, a chorus of people sounded the alarm, highlighting the choice, competition, and innovation Android has brought to the market and the negative impacts this decision will have on phone makers, developers, and consumers. It’s also important to remember the FTC conducted a multi-year investigation into these allegations, concluding that Google’s actions were pro-consumer.
Below is a round-up of reactions to today’s decision.
FTC Commissioner Joseph Simons Statements Questioned EC Ruling, Arguing EC Applies A Different Legal Standard, And Pointing Out Google & Apple Compete Heavily Against Each Other
—Simons: “‘Once [the EU] find that a company is dominant, as I understand it, that imposes on the company kind of a fairness obligation, irrespective of what the effect on the consumer,’ he said. ‘Our antitrust regime requires that there be a harm to consumer welfare, to the consumer. So the two tests are a little bit different.'”
—Simons: Google and Apple do “compete pretty heavily against each other.”
Google’s CEO Argued Android Has Expanded Choice To Phone Makers, Operators, Developers, And Consumers
—Google’s Sundar Pichai: “The decision ignores the fact that Android phones compete with iOS phones, something that 89 percent of respondents to the Commission’s own market survey confirmed. It also misses just how much choice Android provides to thousands of phone makers and mobile network operators who build and sell Android devices; to millions of app developers around the world who have built their businesses with Android; and billions of consumers who can now afford and use cutting-edge Android smartphones.”
Senators Orrin Hatch And Mike Lee Questioned EU Decision
—Senator Hatch: “The EU has a history of engaging in regulatory, tax & competition actions & proposals that disproportionately hit U.S. tech companies. This decision calls into question whether these actions are anything more than a series of discriminatory revenue grabs.”
—Senator Lee: “Today’s decision by the European Commission to fine Google over $5 billion and require significant changes to its business model to satisfy EC bureaucrats has the potential to undermine competition and innovation in the United States. Moreover, the decision further demonstrates the different approaches to competition policy between U.S. and EC antitrust enforcers. … U.S. antitrust agencies analyze business practices based on the consumer welfare standard. This analytical framework seeks to protect consumers rather than competitors. A competitive marketplace requires strong antitrust enforcement. However, appropriate competition policy should serve the interests of consumers and not be used as a vehicle by competitors to punish their successful rivals.”
Experts And Industry Highlighted That Android Is Open, Free, And Non-Exclusive
—CCIA President and CEO Ed Black: “Today’s decision punishes the most open, affordable and flexible operating system in the mobile ecosystem. Android brought more competition, innovation, and consumer choice to the market. These are precisely the things competition authorities are tasked to promote rather than jeopardize.”
—Developers Alliance’s Bruce Gustafson: “Developers are not worried about competing with Google apps on the phone. Our worry is that Android becomes exactly like [Apple’s] iOS, and at that point, it is locked down. … There will be six, seven, eight versions of these closed ecosystems, which means we have to code’ multiple apps.”
—Washington Legal Foundation’s Corbin Barthold: “There are obvious pro‑competitive reasons for Google to want its free operating system to carry its search engine and other apps. For one thing, the apps’ presence is why the operating system is free. By making money from its apps rather than from licensing fees, Google reduces the cost of smartphones. … The EU regulators think their ruling will lead to better apps. It is just as likely to lead to more licensing fees and fewer open platform.”
—ITIF’s Dan Castro: “Google’s investment in the Android mobile operating system has created enormous value for consumers, developers, and device makers. … The Commission’s ruling is a blow to innovative, open-source business models, and other companies will likely think twice before trying to develop anything other than a proprietary, closed system.”
—TechFreedom’s Berin Szoka: “Here, again, the EC has defined the market to make Google seem like a monopoly — by excluding Apple. That Google and Apple compete directly would be obvious to any teenager in even the most remote village in Transylvania. And while they might lust after the iPhone as their first smartphone, they’ll probably start with an Android, because Google’s open source model has enabled a fiercely competitive ecosystem of device manufacturers offering superb, if less sexy, products at a fraction of the cost of Apple’s ultra-premium product. Killing the business model that allows Google to keep Android open source and competitive with iOS won’t help anyone — except maybe Apple.”
—Competitive Enterprise Institute’s Clyde Wayne Crew: “Google is no monopoly, as the existence of Apple’s iPhone and other options attest.”
—Adam Smith Institute’s Sam Dumitriu: Vestager’s announcement “moved the goalposts to make Android look more monopolistic than it really is. To reach the conclusion that Android controls more than 90 per cent of the mobile operating systems market, the Commission decided to exclude Apple’s iOS.”
—R Street Institute’s Caleb Watney: “Asking OEM’s to include a folder of Google apps on the home screen was essentially their way of recouping Android development costs. The EU is now effectively requiring Google to give away Android for free.”
Many Pointed Out The European Commission’s Decision Will Harm Consumers And Developers
—CCIA’s Jakob Kucharczyk: “Consumers have never had so much choice at the tap of a button, at competitive prices. Android has been one of the drivers behind this vibrant competition and innovation. To say that consumers are harmed because of a couple of pre-installed apps is to ignore the billions of app downloads every year.”
—Software & Information Industry Association’s Mark MacCarthy: “The history of open source and mobile operating systems shows clearly that fragmentation can sink otherwise attractive software platforms, and strong governance measures need to be taken to control this risk. Competition authorities, policymakers and courts need to be keep this lesson in mind as they develop and assess policies to promote innovation and consumer welfare.”
—Consumer Technology Association: “Today’s decision by the European Council on #androidworks case threatens innovation that’s enabling the concept of software everywhere & has ramifications far beyond a single company. This will hurt app devs, content creators, marketing firms & more.”
—App Developer Ian Rumac: “Google’s Android is the most convenient. … Breaking it up would will competition because you would have to develop different apps for so many different stores.”
—Utrecht University’s Thibault Schrepel: Vestager’s fine “is more than likely to force Google to cut its R&D investments, or, at least, to slow them down.”
—Adam Smith Institute’s Sam Dumitriu: “Allowing any smartphone maker to use Android for free rather than developing their own operating system has lowered barriers to entry and allowed competition to flourish.”
—Liege Competition and Innovation Institute’s Dick Auer: “The Commission will have struck a blow to the heart of the most competitive offering in the smartphone space. And consumers will be the biggest losers. This is not what the competition laws were intended to achieve.”
—Progressive Policy Institute’s Michael Mandel: The Android ecosystem is “a well-functioning model that provides benefits for everyone—App Economy workers, consumers, smartphone manufacturers, app developers who have a stable environment to aim for. The European Commission’s objections to this model run the risk of hurting jobs and economic growth. Depending on the nature of the penalty that the Commission imposes, Google might need to start charging for Android, driving up phone prices and hurting the app ecosystem.”