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Google stands accused of using its Android smart phone market giant to crush the competition.  (Source: AP Photo)
Is Google abusing its dominant position to proselytize its services?

The world's most popular smartphone operating system, Google Inc.'s (GOOG) Android OS, can't seem to catch a break these days.  If its not being attacked in court [1][2][3][4][5by rival smartphone maker Apple, Inc. (AAPL) whose looking to forcibly remove its products from market [1][2] with lawsuits, it's being probed by antitrust investigators.

The U.S. Federal Trade Commission on Wednesday issued long awaited subpoenas.  For those of you who aren't lawyers and haven't been dragged through a major court case, a "subpoena" is a government demand for testimony or evidence.  Failure to give the requested information can result in criminal and/or civil penalties.

The fact that the U.S. government has issued subpoenas shows that it's getting serious about its investigation of Google.  A Google spokeswoman seemed nonchalant, commenting, "We understand that with success comes scrutiny. We're happy to answer any questions they have about our business."

But for all the cheer, the move is a major concern for Google.

Several small smartphone service providers have claimed that Google applied pressure to its hardware partners to boot their products off their smartphones, in favor of Google's rival services.  In and of itself, that might not be illegal were, Google not by far the industry's most dominant player in sales.  Android is reportedly outselling the next closest company, Apple, 5-to-2 in recent figures.  Thus if Google is found guilty of the allegations, it could face stiff penalties for violating antitrust laws.

Other allegations against Google include reports that it stole data from other services, such as reviews site Yelp and used it to bolster its own offerings.  And Google also stands of artificially boosting its services above competitors' in the results from its search engine -- the most used search engine on the planet.

The issue of the subpoenas was first reported by The Wall Street Journal.  Even if Google can beat the antitrust rap in the U.S. it faces similar accusations in Europe, a place known for its strict antitrust laws [1][2].  

Google has set aside $500M USD in cash to cover possible antitrust penalties.  The question is whether that will be close to enough.



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RE: like Intel?
By Samus on 8/11/2011 1:35:19 PM , Rating: 2
The difference is Intel had direct "compatible" competition: AMD.

Google's Android has no competition. Apple iOS is a closed system and is not licensed. Palm OS was licensed until it was replaced by WebOS, which like iOS, is not licensed beyond Palm (not HP) devices. Windows Mobile licensing fees were high and lets face it, offered a pretty crappy experience for most users.

Android
a) open source
b) has no license agreement
c) free
d) modern
e) compatible with virtually all hardware

There is no other option that offers more than one of those features to manufactures.

HTC dumped Windows Mobile in favor of Android, but is not using Windows Phone 7. The same goes for Samsung, who before Android, depended on their own internal operating system development much like Motorola, LG, etc. Obviously Android was the most attractive alternative, because it was the only alternative.

This subpoena has Apple written all over it. There is no basis for it. There was no reason for Google to pressure their partners to use Android over the competition, because there is no competition.

I'm sure Google is as crooked as every other large company, but this is as frivilous as the Apple patent wars, and comparing Google strongarming to Intel strongarming is ridiculous and have virtually no comparison.


RE: like Intel?
By Samus on 8/11/2011 1:37:06 PM , Rating: 2
Replace all my 'not' with 'now'

Something happened with my spell check there...


RE: like Intel?
By NellyFromMA on 8/11/2011 2:51:38 PM , Rating: 2
It's a little bit more than simply the smartphone OS or device.... It's the inappropriate leveraging of their position as a whole ultimately.


RE: like Intel?
By someguy123 on 8/11/2011 4:28:50 PM , Rating: 2
It's freedom to be manipulated is more of a benefit of the GPL than part of google's marketing. regardless of its open nature, people are claiming that google demanded other OS's be removed from smaller phone manufacturer's product lines. even if the feature list isn't in direct competition to closed platforms, it's still in google's best interest to increase android saturation vs licensed OSs, as google makes money from the search/tracking on android devices.


RE: like Intel?
By michael2k on 8/11/2011 7:12:33 PM , Rating: 2
Did you miss this in the article?
"smartphone service providers"

So... AGPS, maps, search, music, movies, email... anything that would compete with Google, basically.

For example, Google more or less crushed Skyhook:
http://www.engadget.com/2011/05/10/internal-emails...

That would be a smartphone service provider that Google would probably face antitrust inquiries about.


"You can bet that Sony built a long-term business plan about being successful in Japan and that business plan is crumbling." -- Peter Moore, 24 hours before his Microsoft resignation














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