Google's Android division being investigated by the FTC for possible anti-trust violations

Two sources familiar with the probe, say that the Federal Trade Commission is looking into allegations that Google blocked access to the Android operating system for two Google competitors. As a result, the Justice Department will team up with the FTC for the anti-trust investigation. Anonymous FTC officials say that rival tech companies claim that Google puts its own services ahead of others on the Android OS, and in some cases it will restrict competitors from gaining access to the platform.

The EU is already investigating anti-trust claims against Android based on Google's practice of bundling applications like YouTube, Google Maps and Google Chrome onto the OS. The EU is investigating whether this practice harms developers of rival apps, and whether handset manufacturers are hurt by having to take the entire package in order for their phone to run on Android. The EU also wants to make sure that smartphone manufacturers aren't being blocked from developing their own version of Android. Google derives one-third of its revenue from the region served by the EU.

NYU law professor Harry First explains that there could be no violation, even if Android is bundled with many Google Services applications. If consumers can turn to a rival OS, there is no violation says the professor. "The question for Android is, do they really have sufficient market power, particularly in a world where there are other mobile-phone operating systems?"
 
If the FTC plans on continuing the investigation, it will next release its Statement of Objections, which lays out all of the issues that the FTC has with Google. This is important because it will give the company a chance to see what the case is all about, and it gives Google a chance to respond to the complaints.

As of the second quarter of this year, Android owned a 59.3% share of OS placements on U.S. smartphones. Apple was next with 38%, followed by the 2.35% of the market owned by Microsoft and the .36% of the pie belonging to BlackBerry.

source: Bloomberg