On February 16, Google argued before the National Corporation Law Appellate Tribunal that the Competition Commission of India’s (CCI) inquiry, which concluded that the company had exploited its dominant position in the Android operating system, was defective.
The counsel for the IT titan alleged that the director general of the antitrust authority had predetermined views on the subject because he had interrogated original equipment manufacturers (OEMs) misleadingly.
Moreover, Google claimed that the DG still needed to thoroughly research consumers while presenting its results to the CCI.
Despite being confronted with controversial questions, Google claimed that OEMs like Oppo had made it abundantly clear to the DG that the technology giant still hadn’t put any unreasonable requirements on them to enable them to utilise Android as the operating system for their phones.
In October 2022, the authority granted a CCI ruling against Google for exploiting its dominant position in various areas within the Android-based device ecosystem. A fine of Rs 1,337.76 crore was imposed.
In its statements on February 15, Google claimed that the regulator’s ruling was premised on a similar structure issued by the European Commission in 2018 and was subject to “confirmation bias.”
Senior Google lawyer Arun Kathpalia argued that since Android’s open-source license was created, both consumers and producers have profited. He argued that in 2007 when Android was launched, there weren’t any high-quality open-source operating systems.
In Google’s view, Android is an open-source, royalty-free operating system that provides OEMs full freedom to create. In light of these improvements, Kathpalia observed, “There must be some convincing evidence to show Google went terribly wrong.”
There are no comparable explanations, though. According to him, the OS’s owners, OEMs, and application developers are the 3 leading players in the Android operating system.
Nevertheless, Kathpalia contended that the fact that neither of these individuals filed the lawsuit against Google should have refrained the CCI from advancing.
“CCI miscalculated the value of Google’s OEM contract.”
Google stressed that although its Mobile Application Distribution Agreement (MADA) requires device makers to preconfigure the whole Google Mobile Services (GMS) suite, this does not prohibit them from preinstalling rival apps. The firm stated that MADA is a voluntary arrangement and not a necessity.
Kathpalia argued that for a condition in a contract to be classified as unfair, the Competition Act of 2002 contemplates the following:
1) Condition should have been imposed on account of dominance in the market: Google argued that it has been imposing the allegedly ‘offending’ conditions since 2007, even before Android became a dominant player
2) Condition is likely to harm the competition: Google stated that none of the competitors had alleged any adverse effect
3) Condition holds no reasonable value on the party on whom it is imposed: it argued that Google’s apps being preinstalled only adds value to the phones and not the other way round.
4) No objective justification for placement of the condition in the contract: According to Google, apps that it makes available are valuable ones, good for user experience, thereby boosting the sale of the equipment.
Background of the case:
Android customers complained to the CCI in 2018 that Google was exploiting its dominating position in the mobile operating system industry, violating the Competition Act of 2022.
Google’s MADA requirement that device makers preinstall the GMS suite was criticised as unfair. The CCI’s investigative arm’s DG examined this matter afterwards.
The CCI claimed in 2019 that MADA’s required preinstallation of the whole GMS suite was unfair to device makers.
Based on the DG’s report and other materials provided by both sides, the CCI concluded on October 20, 2022, that Google was exploiting its dominant position in various Android mobile phone ecosystem markets.
The CCI decided that Google cannot compel smart device OEMs to preconfigure its apps or prevent consumers from deleting them. It further requested that the US corporation not offer OEM incentives to cooperate.
Google transferred the NCLAT in January without relief. The firm appealed to the Supreme Court. The highest court ordered the NCLAT to rule by March 31, 2023, after refusing to interfere.
The panel heard arguments on February 15 and will resume on February 16 and 17. Firms impacted by Google’s alleged oppressive rules can apply for intervention, the bench said later in the day.
