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Telstra, Optus To End Exclusivity Agreements With Google For Pre-Installed Default Search Engine

Google (Image: Sourced from Unsplash)

Following an intervention by Australia’s top consumer protection regulator, two major telecom companies – Telstra and Optus – have agreed that they will no longer have exclusive agreements with Google Search to have the service pre-installed as the default search engine on Android devices that they sell.

It follows an extensive investigation by the Australian Competition and Consumer Commission (ACCC) into Google’s search services in Australia.

During that investigation, the ACCC became aware of agreements that Google initiated and entered into with Telstra and Optus that limited the ability for rival search engines to be pre-installed and promoted on Android devices, in return for a share of Google’s advertising revenue.

Google’s agreements with Telstra and Optus, found the ACCC, were in place since at least 2017, and expired on 30 June 2024. The two telcos have said that they will not renew or enter any new arrangements with Google that require its search services to be pre-installed and set as the default search function on an exclusive basis on the devices they supply.

“Practices such as entering into agreements to ensure exclusivity can limit consumer choice or deter innovation. Digital platforms with significant market power should be aware of their obligations under Australia’s competition laws,” said ACCC Commissioner Liza Carver.

According to Statcounter, on mobile devices, Google Search’s market share in Australia has remained consistently around 98 per cent from September 2021 to February 2024, with other search engines, including Microsoft’s Bing, having only a meagre presence.

“In our view, these undertakings from Telstra and Optus are an important step in providing Australian consumers with more choice about the digital platforms and services they use, and encouraging more competition in these markets. The undertakings will allow alternative search engines to be able to compete to be a default search engine on the Android devices these companies supply,” added Carver, after the ACCC said that the undertaking by both the telecom companies “resolve” the ACCC’s concerns about their involvement in the alleged anticompetitive conduct.

In Australia, 95 per cent of Australian adults used a mobile phone to access the Internet in 2023.

The ACCC’s ongoing competition investigation into Google’s search services in Australia stemmed from the regulator looking into competition and consumer issues in its Digital Platform Services Inquiry (DPSI). It will submit its DPSI 9th interim report in September 2024 and its final report in March 2025.



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