3 Minutes
Overview
Google has formally admitted to anti-competitive conduct in Australia tied to exclusive pre-installation agreements that favored Google Search on Android devices. The deals with major telcos Telstra and Optus, active between December 2019 and March 2021, required those carriers to pre-install Google Search exclusively on certain handsets. In return, Google shared a portion of the advertising revenue generated by searches on those devices.
Legal outcome and proposed penalty
The admission was submitted in Federal Court proceedings where Google agreed to a joint submission for a A$55 million penalty. The court will still decide whether that penalty and any accompanying orders are appropriate. Alongside the admission, Google entered a court-enforceable undertaking with the Australian Competition & Consumer Commission (ACCC) to address broader competition concerns dating back to 2017. Google does not accept all of the ACCC's wider findings, but has offered remedies to resolve the matter.
ACCC undertaking and commitments
Under the undertaking, Google has committed to removing certain contractual restrictions that limited pre-installation and the designation of default search engines in agreements with Android phone manufacturers and telcos. ACCC Chair Gina Cass-Gottlieb said the resolution could create the "potential for millions of Australians to have greater search choice," arguing the exclusive agreements reduced consumer choice and could lead to worse service.
What changes this allows
The undertaking gives telcos greater flexibility to configure search services on a device-by-device basis and to enter into arrangements with other search providers. It addresses concerns raised during the ACCC’s Digital Platform Services Inquiry, which called for a regulatory framework to promote competition in digital platform services and to tackle practices such as exclusive pre-installation.
Product features and technical impact
From a technical and product perspective, removing pre-installation and default search restrictions means handset makers and carriers can ship devices with alternative search apps and set different default search experiences per device. Features affected include default search routing, integrated search widgets, and quick-access search shortcuts on Android home screens. This change opens the door to integrating specialized search engines, vertical search services, and privacy-focused alternatives.
Comparisons, advantages and use cases
Compared to the previous exclusive model, an open pre-installation environment offers several advantages: increased competition among search providers, potential for innovation in search features, better targeting of local or vertical search services, and improved consumer choice. Use cases include telcos pre-loading regional or privacy-focused search engines, handset makers differentiating devices with custom search integrations, and advertisers adapting to a more fragmented search-ad revenue ecosystem.
Market relevance and outlook
The case has broader implications for digital platform regulation worldwide. It highlights how pre-installation and default settings influence market share and ad revenue distribution in the search ecosystem. The ACCC has recommended mandatory, service-specific codes for designated digital platforms to ensure competitive outcomes. Regulators and industry players will watch closely for the Federal Court's final decision and how global platforms adapt contracts and product strategies.
Conclusion
This development signals a push toward more open competition in mobile search and digital platforms. For consumers, the likely benefit is greater choice; for competitors, it is an opportunity to compete on features and privacy. For Google, the resolution combines a significant penalty with contractual changes that could reshape handset and carrier partnerships across Australia.
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