The logo of US multinational technology and internet-related services company Google in Brussels, Belgium. AFP.
Seoul: Alphabet Inc’s Google has been fined with 42.1 billion won ($31.88 million) by South Korea’s antitrust regulator for blocking the release of mobile video games on a rival’s platform.
In an email statement, Korea Fair Trade Commission (KFTC) said that Google tried to block Korean platform competitor One Store Co.’s business development.
KFTC said that Google bolstered its market dominance and hurt revenue and value of One Store by requiring video game makers to exclusively release their titles on Google Play in exchange for providing in-app exposure between June 2016 and April 2018.
Why South Korea has fined Google?
According to a report by Bloomberg, Google allegedly asked Korea’s major game companies including NCSoft Corp. and Netmarble Corp., as well as smaller firms and Chinese companies, to exclusively release their new games in Google’s Play Store, in return for Google promoting their games and providing further support abroad.
The KFTC in its statement further said that Google featuring a game on its top pages was seen as crucial for Korean game companies’ success in expanding overseas, where visibility of most of their games was low.
The KFTC went on to say that the move by South Korea against Google was part of efforts by the government to ensure fair markets.
“Google makes substantial investments in the success of developers, and we respectfully disagree with the KFTC’s conclusions,” a KFTC spokesperson said.
The KFTC further claimed that Google was aware that the practice was anti-competitive. “This may cause a risk of anti-competition or government-related issues,” one memo from a meeting at Google Korea said.
Google’s response
Responding to accusations of anti-competitive behaviour, Google said that it is an open platform and it doesn’t prevent other app stores from competing. “The company points users to apps from its Play Store because that’s where it can provide the best security and oversight,” the social media giant said.
One Store is a local platform created by South Korea’s three telecom companies — SK Telecom Co., KT Corp., and LG Uplus Corp. — and the internet firm Naver Corp.
According to an analyst at DB Financial, Hyun-Joon Hwang, One Store is preparing an initial public offering (IPO) and is seeking a valuation of $833 million.
With inputs from Reuters
