Tech giants such as Google and Facebook could face major new regulations under a range of preliminary proposals released by the Australian Competition and Consumer Commission as part of its ‘digital platforms’ inquiry.
The ACCC said it was considering recommending that suppliers of operating systems for “mobile devices, computers and tablets be required to provide consumers with options for internet browsers (rather than providing a default browser)”. It said it may also recommend that browser-makers offer consumers options for search engines rather than a default search engine.
“The ACCC considers that where options for internet browsers and search engines are presented, no option should be pre-selected,” the ACCC’s preliminary report stated.
The competition regulator said “customer inertia” was acting as a restraint to expansion of the search services market.
“This customer inertia is reinforced and facilitated by the default bias that results from Google Search being the default search engine on a number of internet browsers and mobile operating systems,” the report states.
“In particular, the pre-installation of Google Search on Safari and Google Chrome (and the pre‑installation of Safari on Apple iOS devices and Chrome on Android devices) is likely a contributing factor to the continued use of both Google Search and Google Chrome by Australian consumers.
“Retaining Google Search as the default search engine is highly valued, as demonstrated by the significant licensing fees Google pays providers of operating systems and internet browsers for this position. The same applies for Google Chrome.”
If the ACCC recommendation was implemented, a consumer would be presented with a number of options for their browser and search engine when setting up a new device.
“The consumer would also be presented with additional information about each of the possible internet browser and search engine options,” the report said.
“For example, next to each possible option, there may be an icon that a consumer could click on to obtain a short summary of the key features of the relevant internet browser or search engine and/or their distinguishing features.”
Such a system would “remove the default bias that currently exists, by providing consumers with an informed choice of internet browser and search engine, rather than simply offering a pre-installed internet browser or search engine for consumers to use.”
The recommendation would “principally affect Google’s products, namely Google Search and Google Chrome,” the ACCC noted.
“The preliminary report examines important topics in relation to Australia’s changing media and advertising industry and we welcome the opportunity to contribute to the ACCC inquiry. As we put forward in our submission [PDF], we develop innovative products to the benefit of consumers, businesses and the economy, and we work closely with advertisers and publishers across Australia,” a Google spokesperson said in an emailed statement. “We will continue to engage with the ACCC between now and the final report next year.”
In July, the European Commission levied a €4.34 billion fine on Google, saying the company had imposed a number of conditions on handset-makers and mobile network operators that fell afoul of EU antitrust laws.
“Our case is about three types of restrictions that Google has imposed on Android device manufacturers and network operators to ensure that traffic on Android devices goes to the Google search engine,” Commissioner Margrethe Vestager said at the time.
“In this way, Google has used Android as a vehicle to cement the dominance of its search engine. These practices have denied rivals the chance to innovate and compete on the merits. They have denied European consumers the benefits of effective competition in the important mobile sphere. This is illegal under EU antitrust rules.”
The commission said that Google had required device-makers to preinstall the Google Search app and Chrome as a condition for licensing the Play Store; paid “certain large manufacturers and mobile network operators on condition that they exclusively pre-installed the Google Search app on their devices”; and “prevented manufacturers wishing to pre-install Google apps from selling even a single smart mobile device” running a forked version Android that hadn’t been approved by Google.
Google is appealing the fine.
In the past, Microsoft has also been fined over the so-called ‘browser ballot’ issue.