Google has agreed to pay AU$55 million ($36 million USD) to Australian competition regulators after admitting its exclusive deals with major telecommunications companies illegally restricted search engine competition.
The penalty represents one of Australia's largest antitrust settlements against a major tech company.
The Australian Competition and Consumer Commission filed federal court proceedings against Google's Asia-Pacific division on Monday, targeting agreements with Telstra and Optus that ran from December 2019 through March 2021.
Under these arrangements, Google shared advertising revenue with the carriers in exchange for exclusive pre-installation rights on Android devices.
How Google's Telco Deals Violated Competition Laws
The agreements specifically prohibited the installation of rival search engines on Android phones sold through Australia's two largest telecommunications networks.
Google admitted these deals "had a substantial impact on competition" and were "likely to substantially lessen competition" in court filings.
Millions of Australian consumers were effectively locked into using Google Search without alternative options.
The arrangements blocked competitors like Microsoft Bing, DuckDuckGo, and Yahoo from gaining meaningful market access through pre-installation on new devices.
ACCC Chair Gina Cass-Gottlieb emphasized the settlement creates potential for "millions of Australians to have greater search choice in the future."
She noted the outcome enables competing search providers to gain meaningful exposure to Australian consumers for the first time in years.
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Google processes over 8.5 billion searches daily worldwide, but in Australia, the company now faces restrictions on how it can secure default search positioning on mobile devices.
Google Removes Restrictive Contract Clauses
As part of the settlement, Google has committed to removing certain pre-installation and default restrictions on search engines from its contracts with Android manufacturers and telecommunications companies.
The tech giant will no longer be able to demand exclusive search positioning in exchange for revenue-sharing arrangements.
Both Telstra and Optus have pledged not to enter similar restrictive agreements since 2024.
The telecommunications companies were not penalized in the settlement, with regulators focusing enforcement action solely on Google's conduct.
A Google spokesperson confirmed the company was pleased to resolve the regulatory concerns.
The company's agreements had not included the contested contract provisions "for some time," according to the statement.
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Mounting Legal Pressure Across Multiple Fronts
The fine adds significant pressure to Google's expanding legal challenges in Australia. Last week, a federal court ruled against the company in a high-profile lawsuit brought by Fortnite developer Epic Games over alleged app store restrictions.
Australia recently included YouTube, Google's video platform, in its groundbreaking national ban on social media access for users under 16.
The legislation represents some of the world's strictest online platform regulations targeting major tech companies.
The Federal Court must still approve the AU$55 million penalty, though the ACCC indicated Google's cooperation throughout the investigation helped avoid lengthy litigation.
Industry observers expect the settlement to influence how tech giants structure future partnerships with telecommunications providers globally.
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