The Australian Competition and Consumer Commission (ACCC) has launched Federal Court proceedings against Google Asia Pacific over anti-competitive deals made with Telstra and Optus.
Google admitted it reached agreements between December 2019 and March 2021 that required the two telcos to only pre-install Google Search on Android phones sold to consumers. In return, Telstra and Optus received a share of Google’s advertising revenue.
Court Action
Google has co-operated with the ACCC, admitted liability and agreed to pay a penalty of $55 million. It is now up to the Court to decide whether the fine and orders are appropriate.
The ACCC said these agreements reduced competition by preventing other search engines from being pre-installed on Android devices.
ACCC’s Response
“Conduct that restricts competition is illegal in Australia because it usually means less choice, higher costs or worse service for consumers,” ACCC Chair Gina Cass-Gottlieb said.
She added that the outcome, along with earlier undertakings by Telstra, Optus and TPG, could give Australians more search choices and allow rival search providers a better chance to compete.
Google’s Undertaking
As part of the settlement, Google and its parent company Google LLC signed a court-enforceable undertaking to remove restrictions in its contracts with phone manufacturers and telcos. This means telcos will no longer be bound to make Google the default search service.
Telstra, Optus and TPG had already signed similar undertakings in 2024, promising not to enter exclusive search agreements with Google in the future.
Background
The action follows a long investigation by the ACCC during its Digital Platform Services Inquiry. The inquiry raised concerns about Google’s dominance in search defaults and recommended stronger rules to prevent anti-competitive practices by big tech firms.
Google’s admitted conduct breached section 45 of Australia’s Competition and Consumer Act. According to court documents, the arrangements likely made it more difficult for rival search engines to compete in Australia.
The ACCC said it remains focused on tackling anti-competitive conduct in the digital economy, especially as new AI search tools enter the market.
