The Australian Competition and Consumer Commission (ACCC) has successfully taken legal action against Google Asia Pacific, resulting in a $55 million penalty imposed by the Federal Court. This penalty stems from Google's anti-competitive conduct involving agreements with Telstra and Optus that restricted the pre-installation of search engines on Android mobile phones.

Between December 2019 and March 2021, Google required Telstra and Optus to exclusively pre-install Google Search on the Android devices they sold, effectively blocking other search engines. In exchange, these telcos received a share of the advertising revenue generated from Google Search.

Google admitted to its anti-competitive behavior, acknowledging that it likely lessened competition in the market. The ACCC's Deputy Chair, Mick Keogh, emphasized the importance of competition in the market economy and the serious consequences of anti-competitive conduct.

In addition to the financial penalty, Google and Google LLC have committed to removing certain restrictions on pre-installation and default search engine settings in their contracts with Android manufacturers and telcos. This commitment aims to enhance competition by allowing other search engines to gain exposure to Australian consumers.

The ACCC has also accepted court-enforceable undertakings from Telstra, Optus, and TPG, preventing them from renewing or entering into new exclusive agreements with Google. This development is expected to provide Australian consumers with greater choice in search services, including those enhanced by artificial intelligence.

The ACCC's ongoing focus on competition issues in the digital economy highlights the need for regulatory measures to ensure a level playing field for all businesses.