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By
Foo Yun Chee and Philip George
BRUSSELS/BENGALURU (Reuters) - Alphabet Inc's <GOOGL.O> Google
will allow rivals to compete to be the default search engines on
new Android devices in Europe, but they will have to pay for the
privilege.
In its latest proposal to ward off fresh EU antitrust penalties,
Google on Friday announced plans to auction spots on a "choice
screen" from which users will select their preferred search
engine.
The move comes a year after the European Commission fined the
U.S. tech giant 4.34 billion euros ($4.81 billion) for blocking
rivals by pre-installing its Chrome browser and search app on
Android smartphones and notebooks.
The EU competition enforcer also ordered the company to halt its
anti-competitive practices or face fines up to 5% of Alphabet's
average daily worldwide turnover.
Google said in a blog post that users in Europe will, from early
2020, be able to pick a default search engine from four options,
including Google, when they set up a new Android smartphone or
tablet. (http://bit.ly/2yuIiwh)
Rival search engines can apply to join Google among the four
options in separate auctions for each individual country. In the
event that fewer than three search providers meet or exceed the
bid threshold, Google will fill any remaining slots randomly
from a pool including those that asked to take part in the
auctions but did not submit bids.
COOL RECEPTION
While consumers will have a choice of default search engine on
their new Android devices for the first time, the plans were not
well received by some of Google's rivals.
"It's Google's way of creating a new revenue stream while giving
rivals an option. Basically they are complying with the EU order
in the letter but not in the spirit," said Ecosia, which
describes itself as an ethical search engine that uses profits
to plant trees.
Ecosia was one of the rivals used as an example in Google's blog
post.
"If we choose to enter an auction and pay Google for the
privilege of being a search engine option on Android, this will
potentially be at the expense of millions of trees we could
otherwise have planted," said Ecosia Chief Executive Christian
Kroll.
"The EU's anti-competition ruling is clear - Google has too much
power. The decision over which search engines are able to use
Android, which is the second-largest operating system in the
world, shouldn’t be up to Google. It should be up to users."
Czech search engine Seznam said it was not clear what the
implications will be.
"It is hard to comment based on a screenshot and a few
sentences. Seznam, and I believe others, too, were not contacted
by Google about this proposition, so we have to wait for
all-important details," said Michal Feix, Seznam's former chief
executive and now partner at a consultancy advising the company.
EU WATCHING CLOSELY
German rival Cliqz criticized the proposal, saying some
companies could lose out to competitors with deeper pockets.
"If the highest bidder wins the contract and not the best search
engine, then the user is the biggest loser. The choice should be
about selecting the most private or innovative provider," said
Cliqz Chief Executive Marc Al-Hames.
Google described the auction process as a "fair and objective
method" to determine which search providers are given as options
for device users.
"It allows search providers to decide what value they place on
appearing in the choice screen and to bid accordingly," the
company said.
The European Commission plans to monitor the process closely.
"The decision provides rival search providers the possibility to
strike exclusive pre-installation deals with smartphone and
tablet manufacturers. This was not possible before," a spokesman
said.
"We have seen in the past that a choice screen can be an
effective way to promote user choice."
The Android proposal asking rivals to pay echoes a separate plan
related to its comparison shopping service, offering to allow
competitors to bid for advertising space at the top of a search
page.
(Reporting by Foo Yun Chee in Brussels and Philip George in
Bengaluru; Editing by David Goodman)
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