S.Korea fines Google $177 million for blocking Android customization

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The Korea Fair Trade Commission said the terms with device makers amounted to abusing Google’s dominant market position by restricting competition

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Seoul — An antitrust regulator in South Korea has charged Alphabet Inc.’s Google 207 billion ($176.64 million) for blocking optimized versions of its Android operating system (OS), in the US tech giant’s second setback in less than a month. fined.

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The Korea Fair Trade Commission (KFTC) said on Tuesday that the terms with device makers amounted to abusing Google’s dominant market position, which restricts competition in the mobile OS market.

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Google said in a statement that it intends to appeal. It said the ruling ignores the benefits offered by Android’s compatibility with other programs and dilutes the benefits enjoyed by consumers.

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The fine comes on the day an amendment to South Korea’s Telecommunications Trade Act – popularly called the “anti-Google law” – went into effect.

The law now prohibits app store operators such as Google from requiring software developers to use their payment systems – a requirement that effectively barred developers from charging commissions on in-app purchases.

The KFTC said Google hindered competition by requiring device producers to comply with an “Anti-Fragmentation Agreement (AFA)” when signing major contracts regarding App Store licenses.

Under the AFA, manufacturers could not equip their handsets with modified versions of Android, known as “Android forks”. KFTC said this has helped Google consolidate its market dominance in the mobile OS market.

The regulator said this could be the ninth largest penalty ever imposed.

In 2013, Samsung Electronics Co., Ltd. launched a smartwatch with a customized OS, but switched to a different OS after Google considered the move as an AFA violation, the KFTC said.

Samsung Electronics declined to comment.


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