An antitrust is a law governing business activities to ensure that there is fair competition between stakeholders and regulates prices of commodities. Google is a company situated in America that deals with the provision of Internet services and products. It is the owner of products like Google Chrome, Android operating system, Google play store and services such Google search engine. Because it is an international company, the Federal Trade Commission watches it keenly so that the laws pertaining to the field is enforced in the United States.
In the recent years, Google has fallen into trouble with the Federal Trade Commission after violating the antitrust laws. It is claimed that Google who is the owner of Android operating system imposes unfair control on mobile phone manufacturers by forcing all of them who wish to use an Android operating system to pre-install Google play store on their devices. Play store, a store that has more than one million applications, have also to pre-install Google as their conventional search engine. In addition, any mobile manufacturing company that wishes to pre-install any of the two should also pre-install Google Chrome application all of which are from the Google Company. It is also claimed that Google Company offers incentives to mobile manufacturing companies to pre-install its search engine. It is argued that through their conventional Google search engine, the company filters the information that can be viewed by consumers and the order in which the information is displayed. There are claims that information from competitors is filtered and placed in secondary pages. Finally, Google also forces companies wishing to install Google play store not to sell other mobile devices that use alternative operating systems using the Androids codes for open source. The move is an effort by Google Company to increase its dominance in the market and make more sales increasing its profits.
It is claimed that this behavior by the Google Company has injured consumers by making competition amongst consumers hard and deterring invention in the broader internet space. An example being that it is claimed that deals between Google and two mobile manufacturing companies’ Samsung and Huawei gave prominence to Android applications through unfair practice. This denies customers access to other innovative mobile devices based on superiority.
The Federal Trade Commission, therefore, went to court and sued Google over an unfair business practice. If the company was to be found guilty, a fine of £5.2 billion or 10 percent of their 2015 incomes was to be imposed on their revenue (Schlossberg, 12). Google would also be forced to change its applications distribution strategy. However, the May case ruled in favor of Google because they reached an argument on how the supply of applications was to be done.
Such fines would have been expensive to Google since their revenues for the year 2015 would have been reduced by 10%. They would also be forced to change the supply strategy of their applications a situation that would have interfered with their total sales. More so, they would have lost the trust of customers reducing their market share. Fines, on the other hand, would have made their products expensive triggering customer to prefer alternatives. Google would have also been exposed to competitors by allowing competitors pages to appear as the first pages on their search engine. This could have enabled more consumers to access information and advertisements on other products a situation that could lead to some leaving for other brands.
Work cited
Schlossberg, Robert S. Mergers and Acquisitions: Understanding the Antitrust Issues. Chicago, Ill: ABA, Section of Antitrust Law, 2008. Print.
