Regulator Seeks Powers to Uproot Google Monopoly in Australia

Google's search engine dominance in Australia faces scrutiny by the competition watchdog. Aleksei/Adobe Stock

Australia’s competition watchdog is requesting powers to develop and implement a cyber system that will require internet users be given a choice on what search engine to choose. It comes after warnings that Google’s “harmful” market dominance was severely stifling competition.

The Australian Competition and Consumer Competition (ACCC) said in its third interim report for an inquiry into digital platform services that Google had leveraged its wealth to entrench itself as Australia’s universal search engine, with its current market share sitting at 94 percent.

In particular, based on public estimates, the ACCC confirmed that Google had paid Apple over US$10 billion (AU$13.2 billion) in 2020—or around 15 to 20 percent of Apple’s net income that year—to be the default search engine in Apple’s browser, Safari, and the default search query service in its voice assistant, Siri.

“Google pays billions of dollars each year for these placements, which illustrates how being the default search engine is extremely valuable to Google’s business model,” ACCC Chair Rod Sims said in a media statement.

Australian Competition and Consumer Commission (ACCC) Chairman Rod Sims speaks during an interview with Reuters in Sydney, Australia, on Oct. 31, 2016. Reuters/Jason Reed

Google Chrome—Australia’s most popular browser also owned by Google—unsurprisingly uses the search engine as its default. But other browsers, such as Firefox, are reportedly being paid by Google US$400 to $450 million a year to keep the search engine as its default, according to ZDNet.

The ACCC said that Google’s and Apple’s influence in the mobile market had exacerbated Google’s search engine monopoly, with Google Chrome and Apple Safari found on 90 percent of mobile devices.

This is because all users with Apple iOS or Android devices have Safari or Google Chrome installed by default and with the ability to uninstall the programs removed altogether.

The report pointed out that many consumers tended to conform to a “default bias” and stick with the programs provided to them, making it difficult for competitors to convince consumers to switch to something else actively.

To combat this, the ACCC put out a request to be able to regulate the options presented to users’ devices through a choice screen that immediately presented a list of available search engines, rather than defaulting to Google.

A "choice screen" offering consumers a selection of alternative web browsers to use. Screenshot

The ACCC concluded that Google search’s overwhelming presence restricted healthy competition and the possibility for new search engines with other innovative features from having a chance in the market.

“This is likely to have stifled innovation and reduced consumer choice,” Sims said. “It means that consumers may not be exposed to or aware of other options, such as search engines that protect users’ privacy and/or have an ecological focus, which limits the ability of these businesses to grow,” Sims said.

The ACCC demonstrated how Google’s market dominance had suppressed competitors despite these other providers offering advantageous features, including data privacy-focused Duck Duck Go and Brave Search, along with Neeva, a search engine that provides a subscription model, but which did not promote ads or affiliate links.

The report is the latest in a five-year inquiry into the digital platforms and services by the ACCC, who have continued to place Google, Apple, Facebook, and other big tech companies under scrutiny over concerns their unregulated presence had served to squash competition and growth.

This includes challenging Google’s Play Store and Apple’s App Store over allegations they had favoured their own apps at the expense of other businesses sharing the same marketplace, as well as investigating Google and Facebook over their dominance in the digital advertising space.