Regulating Google’s Domination

The Japan Fair Trade Commission announced that it had opened an investigation on Google for suspected violation of the Antimonopoly Act. The commission doubts that Google might have excluded its competitors through the agreements with mobile device manufacturers to make them pre-install Google’s applications. Following Europe and United States that already embarked on regulating the occupation of market on web search, JFTC made its stance clear to stand against the internet giants.

The suspect against Google is “entering into license agreements with Android mobile device manufacturers under which Google makes them install its applications, such as a search application named ‘Google Search’ and a web browser application named ‘Google Chrome’, together with its application store named ‘Google Play’, and designates where to place icons, etc. of such applications on screens of the devices.”

 

JFTC is also investigating whether Google entered into agreements with original equipment manufacturers, or OEM, under which Google shared its revenue from its search advertising service with them on conditions including that they do not pre-install competitors’ search application.

 

JFTC for the first time seeks information and comments from third parties in the early stages of the case investigation. “Please submit your information and comments in Japanese by postal mail or e-mail, identifying your name, address and contact information,” JFTC attached the message on the notification in its website.

 

JFTC recognizes the possibility that Google has restricted the OEMs’ opportunity to change the service into others, resulting in exclusion of Google’s competitors. According to the research by Ministry of Internal Affairs and Communications, Google has the biggest share in Japan’s search engine market in smartphones or tablets, which exceeds 70% of all. JFTC thinks that artificial consolidation of ruling power causes consumers’ disinterest, disturbing innovation brought by the developments of superior services by the competitors. Google Japan released a comment that it was offering the users choices for customizing each device.

 

In 2018, European Commission fined Google €4.34 billion for breaching European Union’s antitrust rules, with suspect of illegal restrictions imposed on Android service manufacturers and mobile network operators to cement its dominant position. United States Department of Justice made Google’s case to trial in September, arguing that Google abused its power as a monopoly to dominate the search engine business. 

 

The Digital Market Competition Commission of the government released in June a draft for regulation on IT giants and it will submit it to the Diet session of next year. The draft is supposed to be regulating the prevalence of application which does not allow installing the competitor’s application store. Japan’s effort to catch up with United States and Europe has just started.

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