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Google still claimed to be blocking search rivals on Android, despite Europe’s antitrust action

Judhajeet Das

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Mobile licensing changes made by Google this fall, when it tweaked terms for OEMs wanting to license its Android smartphone platform on devices destined for the European market, don’t appear to be offering succour to search rivals — despite being triggered by an antitrust ruling intended to reset the competitive playing field.

The European Commission found the search giant guilty of anti-competitive practices related to its Android platform this summer, slapping the company with a $5BN fine.

The decision required Google cease practices judged to be illegally skewing the market and do so within 90 days.

It was the second such major EC antitrust finding against Google, after last year’s Google Shopping ruling, when the company was warned that having been found dominant in search it had a “special responsibility” to avoid breaching antitrust rules in any market it plays in.

Google disputes the Commission’s findings of competitive abuse in both cases, and has lodged legal appeals.

But the nature of competition law demands action in the meanwhile, given the threat of punitive penalties for any continued breach. So in October Google responded to the Commission’s Android ruling by updating its regional compatibility agreement to provide a route for OEMs to unbundle key services from the Android OS — rather than requiring its suite of Google apps be pre-loaded for devices to get the Play Store.

However it also incorporated licensing fees for some unbundled configurations (e.g. Android + Play Store). At the same time it said it would not charge any fee to include search or Chrome. And it said it was offering incentives for OEMs to place its eponymous, market dominating search engine (and/or browser) prominently on their devices — despite one of the behaviors the Commission judged illegal being payments Google had made to certain large manufacturers and mobile carriers to exclusively pre-install Google Search.

The Commission did not prescribe specific remedies for the anticompetitive behaviours it pegged to Android — saying it’s “Google’s sole responsibility to make sure that it changes its conduct in a way that brings the infringements to an effective end”.

Though it warned it would closely monitor the company’s conduct, noting that any finding of continued non-compliance would risk fresh fines — of up to 5% of the average daily turnover of Alphabet for each day of non-compliance.

The key word there is “effective” — in terms of what the Commission is watching for.

Meanwhile Google’s dominant position in search naturally makes it the smartphone consumer’s go-to choice — which in turn means there’s a natural incentive for device makers not to ditch Google as the search default. At least for mainstream devices.

But Google’s new European licensing terms for Android appear to be piling additional pressure on OEMs not to switch even for more experimental and/or regional device launches, according to privacy-focused search engine Qwant.

Pay to install

Its experience suggests Google’s initial ‘remedy’ — far from delivering an “effective end” to the competitive infringements the Commission found — is actively steering OEMs away from search alternatives and rival companies.

Qwant, a French startup, launched its non-tracking search offering back in 2013, and has been on a growth tear on its home turf in recent months — winning over high profile users in the public sector as concern has risen about Silicon Valley’s intrusive grip on user data.

The French National Assembly and the French Ministry of the Armed Forces Minister announced this fall they’d switch to Qwant instead of Google as their default.

Of course the startup is still a minnow compared to Google. But it’s growing: Qwant tracks queries rather than users (given it doesn’t track people), and it says it generated 2.6BN queries in 2016; which grew to 9BN last year; and is now on track to end this year with around 18BN queries.

“So if we think about it that means that last year we were three days of Google; this year six days of Google — not so bad!” says co-founder Eric Leandri.

“In France we have now more than 6% of the market,” he continues. “In Germany something like 2%. And we are still growing. We do growth of 20% by month for the last four months. The growth in our revenue is two digit too, by month.”

Earlier this year it had been hoping to make additional regional marketshare gains by securing a deal to be pre-loaded on Android smartphones destined for European markets. A spokesman tells us it has a framework agreement with Huawei. (The Chinese Android OEM is second only to Samsung in global marketshare terms, according to analysts.)

The Commission’s antitrust ruling opened the door to this possibility, given it banned Google from prohibiting OEMs from launching non-Google approved Android forks. So after the ruling things were looking good for Qwant, with the startup on the cusp of securing a device deal for a few European countries, as Leandri tells it. 

He blames Google’s licensing changes for putting the kibosh on a launch they’d been expecting to be able to announce in November. Early that month the startup pinged us to trail forthcoming news — of “a major partnership that will allow us to accelerate in the smartphone market” — only to go silent.

A few weeks later it got in touch again to say it had had to postpone the announcement.

“We are very near to one or two deals to be by default or in the list of search engines in some Android cell phone made by a very large Asian manufacturer… Just for Europe, and just for some countries in Europe but we are talking about 10 million or 20 million of cell phones,” says Leandri now.

“And when we have won the bid against Google in October then Google start to say that in Europe you have to pay $40 for Android. So now if you install Qwant you have to pay $40 and if you install Google they give you some cash.”

“Before it was impossible to bid against Google because Google was blocking everything. Now you can — but now the solution of Google is you have to pay $40 if you don’t install Google by default with Chrome just on the bar. You know the bar that is fixed on Android. And this is again an abuse of their dominant position,” he adds.

“Because if I want, for example, 10 million smartphones, the guy has to pay $400M to Google. Do you really think they will pay $400M to Google just to install Qwant?”

Google’s rebuttal of the Commission’s antitrust finding for Android has focused on claims that its approach of free licensing combined with a bundle of Google services has generally enabled competition to thrive in the mobile app ecosystem, as well as claiming lower prices are a “classic hallmark… of robust competition”.

Yet Qwant’s experience offers a clear counterpoint, underlining how challenging it remains to try to compete with Google’s core search business when the same company also dominates the smartphone market and can just throw the levers of Android’s licensing terms to configure how much ‘appetite’ OEMs have for investing in alternative search defaults (given tiny hardware profit margins in the Android space).

After Qwant won over Huawei to building a device with its search engine in prime position, Leandri says it was Google’s changes to the licensing terms for Android that threw a spanner in the works.

“After that pressure then the manufacturer doesn’t know how to react now,” he says, confirming he believes there’s currently no chance for the device to be launched. Not without further changes to how Android operates in the market — i.e. further regulatory intervention.

“So we will work a lot with the European Commission to stop that,” he adds. “But again, again my question is why Google goes that way?”

We reached out to Google to ask about the fees it would charge an OEM wanting to launch an Android device with Google Play but without Google search as the default in Europe.

We also asked how charging a fee for Android if OEMs don’t also bundle Google services can help increase competition, per the Commission’s intention.

At the time of writing Google had not responded to our questions.

We also reached out to Huawei for comment and will update this story with any response.

Even if Qwant and Huawei get their way, and European buyers in a handful of countries are able to choose to buy an Android device with a little search localization as its differentiating out-of-the-box twist, Leandri isn’t under any illusions that a majority of consumers will still switch back to Google of their own accord — given its dominance of search.

He reckons those who’d stick with a non-Google search choice might be as low as a third or 40%. 

But his point is that, as it stands, Qwant doesn’t even have the chance to try competing against the Google Goliath on its own terms. And he argues that’s simply not fair. 

“Google has billions to make advertisement to ask people to switch, right. And they can even do advertisement on the Play Store for zero because they control the Play Store. Why they don’t come back to a normal market where we are all on the same line and they just compete with advertisement, with pushing their products, with a better proposition of value. It’s crazy, it’s crazy!” he says.

“They have 95% of the market, and on that market they expect that if they don’t have the search by default there then they don’t do money with the Play Store. This is bullshit. They do billions of euros with the app on the Play Store each year. With the 30% that they take on the apps. So this is not true. This is not true, sorry.

“So right now this is our goal and my main work actually is just to obtain the right to have a fair competition — a simple, fair competition.”

“I don’t want to dismantle Google. I don’t want Google to be fined 10BN. I don’t care. The only thing I want is to have the right to have a fair competition,” he adds.

We asked the European Commission to respond to Qwant’s experience, and for an update on its monitoring of Google’s compliance with the Android antitrust ruling.

A spokeswoman declined to comment on an individual case but we understand the Commission has been sending questionnaires to market players as part of its compliance monitoring.

It’s clear the regulator’s intention with the Android decision was to expand consumer choice by creating opportunities for competition that didn’t exist before — including for rival search and browser providers to be able to compete on the merits with Google when it comes to pre-loading their products on Android devices.

So if the Commission’s monitoring efforts confirm instances where competition is being blocked, as appears the case here with Qwant, further interventions will surely follow.

Leandri also points out that Google made much the same arguments vis-a-vis ‘fair competition’ more than a decade ago — when it called for the then computing incumbent, Microsoft, not to stand in the way of Internet upstarts by bundling MSN search into its Internet Explorer web browser. 

“The market favors open choice for search, and companies should compete for users based on the quality of their search services,” said Marissa Mayer in 2006, then Google’s vice president for search products. “We don’t think it’s right for Microsoft to just set the default to MSN. We believe users should choose.”

“I totally agree with what they say in 2006! Just exchange Microsoft for Google and that’s it!” he says now, adding: “We have to fight because there is not a lot of other way. But I stop fighting tomorrow as soon as I have a fair competition.

“I’m not waiting for the Commission to make the competition. Right now the percentage of growth that I have in France it’s not based on the Commission who has won or not. It’s based on our value proposition.”

Leandri is also president of the Open Internet Project, a European organization whose members lobby for regulatory action to rein in what they view as Google’s abusive dominance of digital markets, and which was also involved in the Google Shopping complaints — though he points out that in the Android case three of the five complainants are American. 

“We are the only European. So the problem is not only for a small startup in Europe. Who, y’know, complained because ‘Google is so cool’. And we are so dumb. And so ridiculous. But the problem is for Oracle, it’s for the Fair Search. It’s not for kids.”

Tech Passionate and Heavy Geek! Into Blogging world since 2014 and never looked back since then :) I am also a YouTube Video Producer and a Aspiring Entrepreneur. Founder, MyDroidDoes

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Law enforcement needs to protect citizens and their data

Judhajeet Das

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Over the past several years, the law enforcement community has grown increasingly concerned about the conduct of digital investigations as technology providers enhance the security protections of their offerings—what some of my former colleagues refer to as “going dark.”

Data once readily accessible to law enforcement is now encrypted, protecting consumers’ data from hackers and criminals. However, these efforts have also had what Android’s security chief called the “unintended side effect” of also making this data inaccessible to law enforcement. Consequently, many in the law enforcement community want the ability to compel providers to allow them to bypass these protections, often citing physical and national security concerns.

I know first-hand the challenges facing law enforcement, but these concerns must be addressed in a broader security context, one that takes into consideration the privacy and security needs of industry and our citizens in addition to those raised by law enforcement.

Perhaps the best example of the law enforcement community’s preferred solution is Australia’s recently passed Assistance and Access Bill, an overly-broad law that allows Australian authorities to compel service providers, such as Google and Facebook, to re-engineer their products and bypass encryption protections to allow law enforcement to access customer data.

While the bill includes limited restrictions on law enforcement requests, the vague definitions and concentrated authorities give the Australian government sweeping powers that ultimately undermine the security and privacy of the very citizens they aim to protect. Major tech companies, such as Apple and Facebook, agree and have been working to resist the Australian legislation and a similar bill in the UK.

Image: Bryce Durbin/TechCrunch

Newly created encryption backdoors and work-arounds will become the target of criminals, hackers, and hostile nation states, offering new opportunities for data compromise and attack through the newly created tools and the flawed code that inevitably accompanies some of them. These vulnerabilities undermine providers’ efforts to secure their customers’ data, creating new and powerful vulnerabilities even as companies struggle to address existing ones.

And these vulnerabilities would not only impact private citizens, but governments as well, including services and devices used by the law enforcement and national security communities. This comes amidst government efforts to significantly increase corporate responsibility for the security of customer data through laws such as the EU’s General Data Protection Regulation. Who will consumers, or the government, blame when a government-mandated backdoor is used by hackers to compromise user data? Who will be responsible for the damage?

Companies have a fiduciary responsibility to protect their customers’ data, which not only includes personally identifiable information (PII), but their intellectual property, financial data, and national security secrets.

Worse, the vulnerabilities created under laws such as the Assistance and Access Bill would be subject almost exclusively to the decisions of law enforcement authorities, leaving companies unable to make their own decisions about the security of their products. How can we expect a company to protect customer data when their most fundamental security decisions are out of their hands?

phone encryption

Image: Bryce Durbin/TechCrunch

Thus far law enforcement has chosen to downplay, if not ignore, these concerns—focusing singularly on getting the information they need. This is understandable—a law enforcement officer should use every power available to them to solve a case, just as I did when I served as a State Trooper and as a FBI Special Agent, including when I served as Executive Assistant Director (EAD) overseeing the San Bernardino terror attack case during my final months in 2015.

Decisions regarding these types of sweeping powers should not and cannot be left solely to law enforcement. It is up to the private sector, and our government, to weigh competing security and privacy interests. Our government cannot sacrifice the ability of companies and citizens to properly secure their data and systems’ security in the name of often vague physical and national security concerns, especially when there are other ways to remedy the concerns of law enforcement.

That said, these security responsibilities cut both ways. Recent data breaches demonstrate that many companies have a long way to go to adequately protect their customers’ data. Companies cannot reasonably cry foul over the negative security impacts of proposed law enforcement data access while continuing to neglect and undermine the security of their own users’ data.

Providers and the law enforcement community should be held to robust security standards that ensure the security of our citizens and their data—we need legal restrictions on how government accesses private data and on how private companies collect and use the same data.

There may not be an easy answer to the “going dark” issue, but it is time for all of us, in government and the private sector, to understand that enhanced data security through properly implemented encryption and data use policies is in everyone’s best interest.

The “extra ordinary” access sought by law enforcement cannot exist in a vacuum—it will have far reaching and significant impacts well beyond the narrow confines of a single investigation. It is time for a serious conversation between law enforcement and the private sector to recognize that their security interests are two sides of the same coin.

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Ahead of third antitrust ruling, Google announces fresh tweaks to Android in Europe

Judhajeet Das

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Google is widely expected to be handed a third antitrust fine in Europe this week, with reports suggesting the European Commission’s decision in its long-running investigation of AdSense could land later today.

Right on cue the search giant has PRed another Android product tweak — which it bills as “supporting choice and competition in Europe”.

In the coming months Google says it will start prompting users of existing and new Android devices in Europe to ask which browser and search apps they would like to use.

This follows licensing changes for Android in Europe which Google announced last fall, following the Commission’s $5BN antitrust fine for anti-competitive behavior related to how it operates the dominant smartphone OS.

tl;dr competition regulation can shift policy and product.

Albeit, the devil will be in the detail of Google’s self-imposed ‘remedy’ for Android browser and search apps.

Which means how exactly the user is prompted will be key — given tech giants are well-versed in the manipulative arts of dark pattern design, enabling them to create ‘consent’ flows that deliver their desired outcome.

A ‘choice’ designed in such a way — based on wording, button/text size and color, timing of prompt and so on — to promote Google’s preferred browser and search app choice by subtly encouraging Android users to stick with its default apps may not actually end up being much of a ‘choice’.

According to Reuters the prompt will surface to Android users via the Play Store. (Though the version of Google’s blog post we read did not include that detail.)

Using the Play Store for the prompt would require an Android device to have Google’s app store pre-loaded — and licensing tweaks made to the OS in Europe last year were supposedly intended to enable OEMs to choose to unbundle Google apps from Android forks. Ergo making only the Play Store the route for enabling choice would be rather contradictory. (As well as spotlighting Google’s continued grip on Android.)

Add to that Google has the advantage of massive brand dominance here, thanks to its kingpin position in search, browsers and smartphone platforms.

So again the consumer decision is weighted in its favor. Or, to put it another way: ‘This is Google; it can afford to offer a ‘choice’.’

In its blog post getting out ahead of the Commission’s looming AdSense ruling, Google’s SVP of global affairs, Kent Walker, writes that the company has been “listening carefully to the feedback we’re getting” vis-a-vis competition.

Though the search giant is actually appealing both antitrust decisions. (The other being a $2.7BN fine it got slapped with two years ago for promoting its own shopping comparison service and demoting rivals’.)

“After the Commission’s July 2018 decision, we changed the licensing model for the Google apps we build for use on Android phones, creating new, separate licenses for Google Play, the Google Chrome browser, and for Google Search,” Walker continues. “In doing so, we maintained the freedom for phone makers to install any alternative app alongside a Google app.”

Other opinions are available on those changes too.

Such as French pro-privacy Google search rival Qwant, which last year told us how those licensing changes still make it essentially impossible for smartphone makers to profit off of devices that don’t bake in Google apps by default. (More recently Qwant’s founder condensed the situation to “it’s a joke“.)

Qwant and another European startup Jolla, which leads development of an Android alternative smartphone platform called Sailfish — and is also a competition complainant against Google in Europe — want regulators to step in and do more.

The Commission has said it is closely monitoring changes made by Google to determine whether or not the company has complied with its orders to stop anti-competitive behavior.

So the jury is still out on whether any of its tweaks sum to compliance. (Google says so but that’s as you’d expect — and certainly doesn’t mean the Commission will agree.)

In its Android decision last summer the Commission judged that Google’s practices harmed competition and “further innovation” in the wider mobile space, i.e. beyond Internet search — because it prevented other mobile browsers from competing effectively with its pre-installed Chrome browser.

So browser choice is a key component here. And ‘effective competition’ is the bar Google’s homebrew ‘remedies’ will have to meet.

Still, the company will be hoping its latest Android tweaks steer off further Commission antitrust action. Or at least generate more fuzz and fuel for its long-game legal appeal.

Current EU competition commissioner, Margrethe Vestager, has flagged for years that the division is also fielding complaints about other Google products, including travel search, image search and maps. Which suggests Google could face fresh antitrust investigations in future, even as the last of the first batch is about to wrap up.

The FT reports that Android users in the European economic area last week started seeing links to rival websites appearing above Google’s answer box for searches for products, jobs or businesses — with the rival links appearing above paid results links to Google’s own services.

The newspaper points out that tweak is similar to a change promoted by Google in 2013, when it was trying to resolve EU antitrust concerns under the prior commissioner, Joaquín Almunia.

However rivals at the time complained the tweak was insufficient. The Commission subsequently agreed — and under Vestager’s tenure went on to hit Google with antitrust fines.

Walker doesn’t mention these any of additional antitrust complaints swirling around Google’s business in Europe, choosing to focus on highlighting changes it’s made in response to the two extant Commission antitrust rulings.

“After the Commission’s July 2018 decision, we changed the licensing model for the Google apps we build for use on Android phones, creating new, separate licenses for Google Play, the Google Chrome browser, and for Google Search. In doing so, we maintained the freedom for phone makers to install any alternative app alongside a Google app,” he writes.

Nor does he make mention of a recent change Google quietly made to the lists of default search engine choices in its Chrome browser — which expanded the “choice” he claims the company offers by surfacing more rivals. (The biggest beneficiary of that tweak is privacy search rival DuckDuckGo, which suddenly got added to the Chrome search engine lists in around 60 markets. Qwant also got added as a default choice in France.)

Talking about Android specifically Walker instead takes a subtle indirect swipe at iOS maker Apple — which now finds itself the target of competition complaints in Europe, via music streaming rival Spotify, and is potentially facing a Commission probe of its own (albeit, iOS’ marketshare in Europe is tiny vs Android). So top deflecting Google.

“On Android phones, you’ve always been able to install any search engine or browser you want, irrespective of what came pre-installed on the phone when you bought it. In fact, a typical Android phone user will usually install around 50 additional apps on their phone,” Walker writes, drawing attention to the fact that Apple does not offer iOS users as much of a literal choice as Google does.

“Now we’ll also do more to ensure that Android phone owners know about the wide choice of browsers and search engines available to download to their phones,” he adds, saying: “This will involve asking users of existing and new Android devices in Europe which browser and search apps they would like to use.”

We’ve reached out to Commission for comment, and to Google with questions about the design of its incoming browser and search app prompts for Android users in Europe and will update this report with any response.

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Huawei has constructed an Android various in case US tensions improve

Judhajeet Das

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Tensions between the U.S. and Huawei present no signal of easing. Final week, the electronics big introduced that it has filed a lawsuit towards the federal government over an “unconstitutional” ban on its merchandise. In the meantime, earlier this week, the U.S. threatened German intelligence over the nation’s use of Huawei 5G merchandise.

The corporate has understandably been prepping for an extra downturn in relations by constructing its personal in-home various to Android. The backup was famous by Huawei cellular head Richard Yu, following a yr of rumors across the cellular OS.

“We now have ready our personal working system; if it seems we will not use [Android], we shall be prepared and have our plan B,” the exec stated.

Huawei started constructing the software program in earnest after a U.S. ban on ZTE. Using software program and hardware from U.S. corporations like Google and Qualcomm in Chinese language smartphones has led to growing tariffs on each side.

Along with considerations over ties to the Chinese language authorities, Huawei has additionally been hit over its alleged skirting of Iranian tariffs. That landed the corporate’s CFO Meng Wanzhou in a Canadian jail. In fact, all of this hasn’t slowed Huawei’s international progress. The corporate noticed a 50 % bounce in income regardless of mounting considerations.

We’ve reached out to Huawei for additional affirmation.

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