Google app suite may cost up to $40 per phone after new EU deal
Many would say that the European Union has been picking on Google quite a lot lately. The company has been fined multiple times over the last few years with the latest breaking records when it was issued a $5 billion fine for antitrust violations. With Google having such a dominant market share across the union, they weren’t happy with Google’s practice of pre-installing apps like Search and Chrome on Android. Not only does the company have to pay that massive fine but they also have to make some changes. Documents sent to The Verge indicate that Google could end up charging OEMs up to $40 per phone if they want to install the “Google Mobile Services” suite of apps (which includes the Google Play Store).
In general, the goal of a company is to make a profit and beat out the competition, but once you become so dominant in a certain market you have extra rules applied. These extra rules are put in place so that things are fair for any other company to compete in the field. This has been a thorn in Google’s side for a few years as some reports put Android with over 80% of the mobile OS market share around the world. This number can be even higher when we break things down to certain countries and this has made Google a major target for the European Commission and their antitrust laws.
Earlier this week we learned that Google was putting a plan in place that would charge smartphone OEMs in Europe to use Google apps. The idea goes like this: if a smartphone company wants to use the “Google Mobile Services” suite of apps (which includes the Google Play Store) then they have to pay Google up to $40 per device. The cost actually depends on the pixel density, with displays with higher than 500 PPI having to pay $40, the cost of devices with 400 to 500 PPI would have to pay $20, under 400 PPI would cost them $10 and really low-end smartphones would have a $2.50 fee attached to it.
There are a lot of Android applications that are currently dependant on things like Google Play Services, so this puts OEMs in a pinch. The program is said to apply to devices activated on or after February 1st, 2019 (according to said documents) and also comes in different tiers. The main part of this program includes the “Google Mobile Services” suite of apps, which includes the Google Play Store. That matches up with the Google’s statement we covered earlier this week which had one bundle including the Play Store, Google Maps, Gmail, and YouTube while the other included Google Search and Chrome.
Speaking of Google Search and Chrome, there’s a part in the documents from The Verge which state that companies choosing to not pre-install Chrome (and place it in the phone’s home screen dock) would also miss out on search revenue sharing from Google. This type of search revenue sharing is something that has been in place for a while as an incentive to prioritize Google and its apps. This search revenue sharing from the browser part seems to be included in these new documents and doesn’t seem to be going anywhere.
Source: The Verge