Google was sued over market power abuse by allegedly forcing Android smartphone makers to adopt popular Google apps such as YouTube as a scheme to ensure its market monopoly.
The lawsuit was filed by EVO 3D, the manufacturer of HTC devices made in 2011, in the U.S. District Court for the Northern District of California. It claims that Google’s secret mobile agreement caused the device to become more expensive.
In the last quarter of 2013, IDC had announced that Android run smartphones have occupied 78 percent of the market share. Others such as Apple, Windows, and Blackberry have a market share of 18 percent, three percent, and 0.6 percent respectively.
Based on the complaint, Google generates a yearly profit of billions of dollars by posing itself as an enhanced search engine to make consumers pay for search-related advertisements.
The secret mobile agreement requires every Android device manufacturer to create smartphones with pre-loaded apps in the gadget’s home screen whether or not these apps are needed as observed in Samsung and HTC devices.
Google was quick to deny the allegations.
“Anyone can use Android without Google and anyone can use Google without Android,” Matt Kallman, a spokesperson for Google, said through email to Reuters.
The concept of Android MADAs (mobile application distribution agreements) was first revealed in a blog written by Professor Ben Edelman of Harvard Business School. In the blog, the professor pointed out the presence of anticompetitive behavior from such agreements that are now similar to the lawsuit claims filed against Google.
“Google did this through secret contract restrictions -- documents that probably wouldn’t have become widely available to the public had I not presented them on my site in February,” Edelman said in an e-mail to Businessweek. “The secrecy is itself troubling -- users see Google apps pre-installed and conclude that carriers and other users must think they’re the best, when in fact Google apps are pre-installed only because Google insists that they be there.”
