CRA Insights

Google Android: “European techlash” or milestone?

July 1, 2018

The European Commission announced today that it is fining Google €4.34bn for “Us[ing] Android as a vehicle to cement its dominance as a search engine”.  In this note, we explain why we regard the theory of harm as legitimate and economically sound.  The discussion should not be confounded by various “myths” around the EC’s intervention – that foreclosure cannot occur in markets where “competition is a click away”, and that if only “the market was correctly defined” taking into account competition between Android and Apple devices, the case would go away.  In any event, the bigger question as always is not the size of the fine, but the implications for incentives going forward. Is the business model materially affected? Can the remedies have any traction at all? What does this imply for tech more generally?