EU fines Google a record $5B

BRUSSELS — European regulators came down hard on another U.S. tech giant Wednesday, fining Google a record $5 billion Wednesday for forcing cellphone makers that use the company’s Android operating system to install Google search and browser apps.

The European Union said Google’s practices restrict competition and reduce choices for consumers.

While Google can easily afford the fine, the ruling could hurt the company’s business model, which relies on giving away its operating system in return for opportunities to sell ads and other products.

Google immediately said it will appeal, arguing that its free operating system has led to lower-price phones and created competition with its chief rival, Apple.

Android has “created more choice for everyone, not less,” Google CEO Sundar Pichai tweeted.

The fine, which caps a three-year investigation, is the biggest ever imposed on a company by the EU for anticompetitive behavior.

It is likely to stoke tensions between Europe and the U.S., which regulates the tech industry with a lighter hand and has complained that the EU is singling out American companies for punishment.

In its ruling, the EU said Google broke the rules by requiring cellphone makers to take a bundle of Google apps if they wanted any at all.

The bundle contains 11 apps, including YouTube, Maps and Gmail, but regulators focused on three that had the largest market share: Google’s Search and Chrome apps, and its Play Store app marketplace.

The EU gave Google 90 days to come up with remedies that could allow rival search apps and browsers onto more phones. Failure to comply risks a further penalty of up to $15 million a day.

The EU also took issue with Google’s payments to wireless carriers and phone makers to exclusively pre-install the Google Search app.