구글 안드로이드 앱 선탑재 행위에 관한 경쟁법적 고찰
A study on the Competitive Effects of Google's Pre-installation of Android Applications
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In light of the KFTC’s recent announcement that it will look to investigate the actions of Google, this article explores the recent decision of the European Commission (the "EC") regarding Google's business practices regarding Android mobile devices. The EC held that Google, a dominant undertaking in markets for general internet search services, with its licensable smart mobile OS and app stores for the Android OS, abused its market position to strengthen dominance of its position in general internet search. Of the three business practices of Google that were reviewed in the EC case, this article focuses on the first two practices which may have a significant impact on the Korean market as well: i) Google's demand for the pre-installation of its search app along with its browser app as a condition to receiving its app store licence; and ii) its provision of incentives to mobile device manufacturers and mobile network operators on the condition that they exclusively pre-install its search app. For the tying of Google's search and browser apps, the KFTC may refer to In the Matter of Microsoft (Decision No. 2006-042, Feb 24th, 2006), in which it sanctioned Microsoft for tying Windows Media Service with Windows Server OS, and for tying Windows Media Player and Windows Messenger with Windows PC OS. However, although Microsoft's bundling looks similar to the Google's at a first glance, the fact that in the case of Microsoft, it was much easier for consumers to replace the pre-installed app with another app may lead the KFTC to come to a different conclusion. Regarding the issue of Google's provision of incentives to device manufacturers and network operators, it is worth looking at In the Matter of Intel (Decision No. 2008-295, Nov 5th, 2008) and In the Matter of Qualcomm (Decision No. 2009-281, Dec 30th, 2009). As professor Pinar Akman points out, the differing degrees of exclusivity conditioned on the pre-installation of a software and the installation of a hardware chip should be considered. In addition, whether the provision of incentives restricts competition will depend on the specific details and size of such incentives – the value payable by the device manufacturers or network operators to Google in the absence of such incentives, the price offered or offerable by other competing search app businesses will also be key considerations. Even if the incentives provided by Google in exchange for exclusive pre-installation are sizeable, if such incentives are unaffecting when compared to the overall price payable to Google by the device manufacturers and network operators, then the provision of such incentives is unlikely to be seen as limiting competition. Finally, this article also notes that the relationship between abuse of market-dominating position and unfair trade practices should be reconsidered, at least for the types of unfair trade practices that are focused on restriction on competition, such as tying and loyalty rebates. Along with the EC’s decision, the KFTC’s decision in this area is expected to have a tremendous impact not only on the mobile industry, but also on global competition law.
Abstract
In light of the KFTC’s recent announcement that it will look to investigate the actions of Google, this article explores the recent decision of the European Commission (the "EC") regarding Google's business practices regarding Android mobile devices. The EC held that Google, a dominant undertaking in markets for general internet search services, with its licensable smart mobile OS and app stores for the Android OS, abused its market position to strengthen dominance of its position in general internet search. Of the three business practices of Google that were reviewed in the EC case, this article focuses on the first two practices which may have a significant impact on the Korean market as well: i) Google's demand for the pre-installation of its search app along with its browser app as a condition to receiving its app store licence; and ii) its provision of incentives to mobile device manufacturers and mobile network operators on the condition that they exclusively pre-install its search app. For the tying of Google's search and browser apps, the KFTC may refer to In the Matter of Microsoft (Decision No. 2006-042, Feb 24th, 2006), in which it sanctioned Microsoft for tying Windows Media Service with Windows Server OS, and for tying Windows Media Player and Windows Messenger with Windows PC OS. However, although Microsoft's bundling looks similar to the Google's at a first glance, the fact that in the case of Microsoft, it was much easier for consumers to replace the pre-installed app with another app may lead the KFTC to come to a different conclusion. Regarding the issue of Google's provision of incentives to device manufacturers and network operators, it is worth looking at In the Matter of Intel (Decision No. 2008-295, Nov 5th, 2008) and In the Matter of Qualcomm (Decision No. 2009-281, Dec 30th, 2009). As professor Pinar Akman points out, the differing degrees of exclusivity conditioned on the pre-installation of a software and the installation of a hardware chip should be considered. In addition, whether the provision of incentives restricts competition will depend on the specific details and size of such incentives – the value payable by the device manufacturers or network operators to Google in the absence of such incentives, the price offered or offerable by other competing search app businesses will also be key considerations. Even if the incentives provided by Google in exchange for exclusive pre-installation are sizeable, if such incentives are unaffecting when compared to the overall price payable to Google by the device manufacturers and network operators, then the provision of such incentives is unlikely to be seen as limiting competition. Finally, this article also notes that the relationship between abuse of market-dominating position and unfair trade practices should be reconsidered, at least for the types of unfair trade practices that are focused on restriction on competition, such as tying and loyalty rebates. Along with the EC’s decision, the KFTC’s decision in this area is expected to have a tremendous impact not only on the mobile industry, but also on global competition law.
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