OEMs signed Google’s agreements as they did not intend to develop own operating system, tech giant to NCLAT

Google's event came one day after Microsoft unveiled plans to integrate its rival AI chatbot ChatGPT into its Bing search engine and other products

Google on March 1 argued at the National Company Law Appellate Tribunal (NCLAT) that the original equipment manufacturers (OEMs) signed agreements with it as they did not intend to develop their own operating systems.

The tech giant was countering Competition Commission of India’s (CCI) observation that Google reduced the ability of and incentive for device manufacturers to develop and sell devices operating on alternative versions of Android by making pre-installation of Google’s apps mandatory.

On its Anti-Fragmentation Agreement (AFA), which prohibits OEMs to manufacture/develop hardware for themselves or for any third party which is not Android-compatible, Google argued that it was brought in so that once an app for Android is written, it runs on all Android devices.

Google argued that maintaining baseline requirements ensured that each brand developed unique features for its device to improve its marketability. Google cited the example of Samsung and One Plus smartphones to say that despite both phones running on Android OS, they look different owing to the features they built to improve its marketability.

Also Read | CCI's Android abuse order suffers from 'confirmation bias', Google alleges at NCLAT hearing

Android fork is a version of the software that has been modified from the open-source version of the source code but has not been approved as “Android-compatible” by Google.

Google argued that the CCI has committed an error in asking it to provide its proprietary application program interface (API) to forked devices. The tech giant stated that its API, which is a critical programming code to ensure the functioning of Android apps, can be given only to those OEMs that comply with its agreements such as Mobile Application Distribution Agreement (MADA) and AFA so as to maintain certain baseline quality.

The tech giant argued that the API is its intellectual property and the CCI could not have asked it to share it with forks. In a sarcastic vein, Google’s lawyer Arum Kathpalia said, “We are glad that the CCI did not ask us to share our search algorithm with our competitor Bing,” referring to Microsoft’s search engine.

Kathpalia added that Google provides Apache License (which allows users to use the software of any purpose) only for Android Open Source (AOS) and not for any of its proprietary software.

Also Read | Google created ‘contrived urgency’ in seeking stay on Android ruling: Supreme Court

Side-loading is a mechanism that Android uses to discourage users from downloading unknown apps from another developer’s website rather than from its Play Store. The CCI had asked Google to discontinue side-loading as it makes users download apps only from its online store. Google claimed that it scrutinises every application on Play Store to avoid malware, adding that when a user downloads an app from a website, there is no such scrutiny, thereby increasing chances of malware. Google argued that it is obligated to warn users from downloading malwares and the CCI should not have passed such a direction.

Google also said that when it permits other stores on Android, there is a chance that many unknown apps can feature in them, increasing the possibility of malware being downloaded to a device.

The tech giant stated that the CCI orders on side-loading and non-Android online stores was beyond the scope of the Competition Act.

Kathpalia concluded his arguments on Wednesday, and the CCI is expected to commence its arguments from Thursday.

In 2018, Android users alleged before the CCI that Google was abusing its dominant position in the mobile operating system-related market in contravention of the provisions of the Competition Act, 2022. It was alleged that Google asking device manufacturers to preinstall the entire Google Mobile Services (GMS) suite under MADA was an unfair condition. The CCI subsequently ordered an investigation by the director general of its investigative arm on this issue.

The CCI in 2019 expressed a prima facie opinion that mandatory pre-installation of the entire GMS suite under MADA amounted to the imposition of unfair conditions on device manufacturers.

On October 20, 2022, the CCI, based on the DG’s report and other documents filed by both sides, concluded that Google was abusing its dominant position in multiple markets in the Android mobile device ecosystem.

The CCI held that Google can neither force OEMs of smart devices to preinstall its apps nor restrict users from uninstalling such apps. Furthermore, it asked the US-based company not to offer any incentives to OEMs to comply with its conditions.

Google moved the NCLAT in January, but failed to get immediate relief. The company then approached the Supreme Court against the tribunal's decision. While the apex judicial body refused to intervene in the case, it asked the NCLAT to decide on the matter by March 31, 2023.

On February 15, Google argued that the antitrust regulator's order suffers from "confirmation bias" and is based on a similar order issued by the European Commission in 2018.

On February 16, the tech giant argued that the CCI order is based on a flawed investigation.

The tribunal began its hearing in the case on February 15, and will continue to hear arguments by Google on March 2. Additional solicitor general R Venkataraman is expected to begin his arguments for CCI on Thursday.