4 Jan 2017

The EU's Monopoly Claims about Android Make No Sense

The EU is going after Android. Google requires OEMs to bundle all the Google apps Google tells them to if they want to bundle any one Google app. The EU says that this is monopolistic. Unfortunately, the EU's arguments make no sense.

First, is there any evidence that users are being denied choice, or pushed to use services they don't want to? One billion WhatsApp users can't be wrong. Those people aren't on Hangouts despite it being preinstalled. In an ideal world, regulators would have to provide evidence of harm to the market before they can take action. Not supposition or conjecture, but actual evidence.

Second, the EU has defined the market as mobile operating systems that can be licensed. That immediately sounds like an artificially narrow market definition, designed to include Google but exclude Apple. People who don't like Android can buy an iPhone, and vice-versa, so a sensible definition of the market would be the entire smartphone OS market. No sane person would claim that the iPhone and Android are not in competition.

Third, the EU claims that the cost to switching platforms is high, but that doesn't make sense, given most data is stored in the cloud and access through apps available on both iOS and Android. Many of which are made by Google, in fact. In other words, Google is making it easy to switch platforms, so how can the EU pursue Google for making it hard to? There are also apps like Apple's Move to iOS which transfers all your data to your new iPhone — contacts, photos, musics, apps, everything. People also generally use free apps, so there's little monetary cost to downloading an app again on the iPhone if you used it on Android. Even if it's paid, it's usually a hundred rupees or so, which is nothing in comparison with the sixty thousand rupee price of the iPhone.

Fourth, Google imposes far fewer restrictions on third-party manufacturers than Microsoft or Apple, who doesn't even offer iOS to third parties. As a commenter said:
I really don't understand this case. Since Google offers an OS to manufacturers to use, but asks them to include apps so they can make some money, it's antitrust? If they didn't offer their OS to others (like Apple), then there would be no problem? It's not like manufacturers can't load other things in addition. A company could easily load a Yandex app or something and make it prominent, while virtually hiding the Google stuff.
It's counterintuitive to go after the OS that's open-source and available with fewer restrictions than its competitors. As Google points out, all the preinstalled apps on the iPhone are Apple's, and three-fourth of the preinstalled apps on the Lumia 550 are Microsoft's, but less than a third of apps on the Galaxy S7 are Google's. If anything, Google is more open to competition, since OEMs can and do compete with Google by preinstalling their apps. By contrast, Gmail isn't preinstalled on the iPhone.

Fifth, if a manufacturer wants to bundle one Google app on their Android phone, Google forces them to bundle other Google apps. The EU says that this is anticompetitive. Google's answer is that that's the business model: give away the OS free and make money on services. Take the latter away, and the whole business model falls apart. If it's no longer viable for Google to invest in Android, that would reduce choice in the market, not increase it.

Sixth, if the EU has its way and some Android phones come with Gmail, some with Google Calendar, some both, and some neither, that will make it confuse users, and make it harder for users to find the phone with the apps they want, not easier. It will also fragment the OS, making it hard for developers to build great apps.

Seventh, shouldn't users get a base set of services so that their new phone is useful out of the box? That makes the phone better, not worse. Why should government bureaucrats dictate what should or shouldn't be included? The EU tried to second-guess tech companies before, when they forced Microsoft to release a version of Windows in Europe that didn't have Windows Media Player. That didn't succeed, because given a choice between an OS that can play media out of the box and one that can't, which sane person would choose the latter? The real problem is that in a fast-moving world like technology, bureaucrats aren't good at dictating what kind of functionality you should or shouldn't get out of the box.

Eighth, Google services are usually best in class. It's not like we're being forced to use a substandard product like iCloud Mail.

Ninth, EU claims that Google bundling their services is unfair to third parties. As a commenter said:
That's ridiculous. Using that logic, Microsoft can't bundle Paint with Windows, because that would be unfair to Adobe, Corel and others.
Everything a company does in pursuit of its goals can be construed as being unfair to someone else.

One fair and sensible requirement the EU can impose on Google is to make their apps uninstallable. Users should be able to uninstall them, not just disable them. Uninstalling it should free up space and be as if the app wasn't bundled in the first place.

That shouldn't be hard to do. Android currently includes the bundled apps in the OS image, which is readonly. Instead, the APKs can be included in the data partition of the phone. On first run, the OS installs the apps and deletes the APKs. This installation is no different from installation of apps from the Play Store, except that the data is cached locally. Another implementation would be for the first-run wizard to download the binaries from Play, without any user interaction. Maybe there are other implementation choices one can come up with, but the point is that it's easy to make the bundled apps uninstallable, like the bundled apps on Windows laptops.

If the bundled apps are uninstallable, that makes them just suggestions from Google that we may find these apps useful. If not, we can uninstall them. This is completely different from the status quo, where Google forces apps like Google+ down our throat, whether we want them or not. Suggestions are welcome, force isn't.

This would be a good requirement for the EU to impose on Google. Most of their other claims are senseless.

When the EU makes unfounded allegations, it suggests that the EU is regulated based not on facts and evidence but on the whims of whoever the competition commissioner happens to be.

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