google: Google searches, gets relief before appeal

The National Company Law Appellate Tribunal (NCLAT) has watered down some of the restrictions imposed by the Competition Commission of India (CCI) on Google, while upholding a fine for abuse of dominance of the Android mobile operating system (OS). Google does not need to permit uninstallation of its bouquet of apps like YouTube and Google Maps that come loaded on all Android devices. It does not have to make Google Play Store a distributor of apps developed on other apps stores. Apps need not be allowed on Android devices by sideloading. Google can also restrict access to its application programming interface by handset makers. These are all critical elements of the Android business model and Google has secured considerable relief before a final appeal in the Supreme Court.

The NCLAT verdict upholds substantive parts of the CCI order, which largely address concerns over Google’s dominance in mobile OSs. Device manufacturers cannot be coerced into installing Google apps, are free to develop forked versions of Android, and have choice over using default search services from other vendors such as Microsoft’s Bing. These conditions are serious trust-busting measures in themselves that may not be enough for CCI, which could appeal against NCLAT’s relaxations.

Based on the NCLAT verdict, the Android OS is headed for fragmentation. This imposes costs: for ensuring security of forked versions on device makers, and for making apps compatible with multiple iterations by developers. On the flip side, a significant slice of well-monetised software such as search, navigation and content hosting is now open to a wider array of players. India is a very big market for Android, and future evolution of the OS globally will be shaped by the antitrust action in the country. The use of Google’s OS and app store to further its dominance of highly lucrative app-based revenue streams may be in the past if the Supreme Court does not provide it further relief.