Google Fined $36 Million for Blocking Rival Search in Australia

A hidden arrangement designed to lock competitors out of millions of Australian smartphones has resulted in a massive penalty for tech giant Google. The company will pay $36 million after admitting to striking secret deals with Australia’s largest phone carriers, Telstra and Optus, to block rival search engines on Android devices sold to consumers. The Australian Competition and Consumer Commission (ACCC) announced the settlement on Monday, August 18, 2025, following a finding of anti-competitive conduct between late 2019 and early 2021.

Under these deals, Google shared advertising revenue generated from its search engine with Telstra and Optus. In return, the carriers agreed to exclusively pre-install Google Search on Android phones they sold, deliberately excluding competitors. This meant millions of Australians buying new phones from these providers found Google already set as their default search engine, with no rival options readily available. ACCC Chair Gina Cass-Gottlieb stated this conduct “harmed competition and significantly reduced consumer choice in the critical search engine market.”

What Does This Google Settlement Mean for Australian Consumers?

The $36 million fine is a significant enforcement action, but the real impact for Australians lies in the binding commitments Google has now made. As part of the settlement approved by the Federal Court, Google must:

• Remove clauses from its contracts with Australian telcos and phone manufacturers that restrict the pre-installation of rival search engines.
• End requirements forcing Google Search to be set as the default or exclusive search service on devices.
• Sign a court-enforceable undertaking addressing broader competition concerns raised by the ACCC.

Chair Cass-Gottlieb emphasized the timing: “This outcome opens the door for millions of Australians to have greater choice in search engines on their new phones. This is particularly important as new AI-powered search tools emerge, changing how consumers find information and creating new competition dynamics.” The changes aim to level the playing field, allowing alternative search providers like Bing, DuckDuckGo, or emerging AI-driven services a fair chance to be pre-installed and chosen by users.

Part of a Broader Regulatory Crackdown

This penalty arrives amidst escalating legal and regulatory pressure on Google in Australia. Just last week, the Federal Court ruled against both Google and Apple in a separate lawsuit brought by Epic Games. The court found the tech giants misused their market power in their respective app stores, stifling competition against developers like Epic. That landmark ruling paves the way for significant compensation claims and forces Apple to allow Epic’s app store and Fortnite back onto iOS devices in Australia.

Furthermore, Google-owned YouTube recently lost its exemption from Australia’s new law banning social media access for users under 16, adding to the company’s compliance challenges. These consecutive legal setbacks signal a hardening stance by Australian regulators towards the market dominance and practices of major global tech platforms. The ACCC’s successful pursuit of the search pre-installation case demonstrates a commitment to enforcing competition law in the digital sphere.

The $36 million penalty underscores a critical shift: anti-competitive tactics that limit consumer choice, even through secret deals with partners, carry severe consequences in Australia. As AI reshapes search, regulators are ensuring the market remains open, forcing Google to fundamentally change how it operates with device sellers and empowering Australians with genuine choice on their new Android phones. This landmark settlement sets a precedent for fairer digital markets – share this news to raise awareness of consumer rights in the tech age.

Must Know

Q: How long did Google’s anti-competitive deals with Australian telcos last?
A: According to the ACCC announcement (August 18, 2025), Google admitted the conduct occurred between December 2019 and March 2021, spanning approximately 15 months.

Q: How did the Google-Telstra/Optus deals work financially?
A: The ACCC found Google shared advertising revenue generated from searches on the affected Android devices with Telstra and Optus. In return, the telcos agreed not to pre-install any rival search engines on phones they sold.

Q: What is the broader significance of this $36 million Google fine?
A: Beyond the penalty, it forces Google to change its contracts in Australia, removing clauses that blocked competitors. This opens the market for alternative search engines, especially crucial as new AI search tools emerge. It also signals stronger ACCC enforcement against digital platform anti-competitive conduct.

Q: What specific changes must Google make in Australia now?
A: Google must remove restrictive clauses from its contracts with Australian telcos and phone makers, stop forcing Google Search as the exclusive or default option, and adhere to a court-enforceable undertaking addressing ACCC competition concerns.

Q: How does this relate to the recent Epic Games case in Australia?
A: Both cases involve ACCC/Federal Court action against major tech firms (Google and Apple) for anti-competitive practices – Google/Apple with app stores, and Google specifically with search engine pre-installation via telcos. They highlight a coordinated regulatory pushback.

Q: Was this Google fine only about money?
A: No. While the $36 million penalty is substantial, the mandated changes to Google’s business practices in Australia, ensuring greater choice for consumers and competitors, are considered the most significant outcome by the ACCC.