EU hits Google with record $5 billion fine

Company accused of forcing cellphone makers that use its popular Android operating system to install Google apps.

The European BRUSSELS —

Union fined Google a record $5 billion Wednesday for forcing cellphone makers that use the company’s hugely popular Android operating system to install Google apps.

The EU said the practice restricts competition and reduces choices for consumers.

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.

Google immediately said it will appeal. Android has “created more choice for everyone, not less,” Google CEO Sundar Pichai tweeted.

In its ruling, the EU said Google broke the rules when it required mobile phone makers to pre-install the Google Search and browser apps if they wanted to use Google’s app store. Google also paid big producers to exclusively pre-install the Google Search app.

EU Competition Commissioner Margrethe Vestager said “companies must compete on their merits,” playing by rules that favor consumers and open markets, and not restrict competition.

Vestager said that given the size of the company, the 4.34 billion euro fine is not disproportionate. The penalty is on top of 2.42 billion euro fine ($2.8 billion) that regulators imposed on Google a year ago for favoring its shopping listings in search results.

The latest fine is well within Google’s means. Its parent company, Alphabet, made $9.4 billion in profit in the first three months of the year and reportedly had over $100 billion in cash reserves.