South Korea’s competition regulator has launched an antitrust investigation into Google over claims that the company used unfair business practices to keep game developers tied to its Android app marketplace.
The Korea Fair Trade Commission (FTC) announced on Wednesday that it has sent an examiners’ report to Google, including its U.S., Singapore, and South Korean offices. The report alleges that Google abused its dominant position in the Android app market through agreements made with major game developers. The watchdog said the related sales involved in the case total about US$9.21 billion, meaning Google could face a fine of up to 6% of that amount if the allegations are confirmed.
At the center of the investigation is Google’s Games Velocity Program (GVP). According to the FTC, the program offered financial support to game developers for using Google services such as Google Cloud and advertising. In return, developers were expected to give Google more favorable treatment than competing app stores, including releasing games earlier on Google Play.
The regulator believes these agreements made it more difficult for game developers to distribute their games through rival app marketplaces. Investigators also concluded that the program effectively encouraged exclusive business relationships with Google, limiting competition and affecting other app store operators.
Google has been given eight weeks to submit a written response to the FTC’s findings before the commission decides on any penalties.
In a separate case, South Korea’s Fair Trade Commission recently approved voluntary corrective measures proposed by e-commerce company Coupang and its private-label unit. The companies agreed to implement reforms worth 3 billion won (around US$1.94 million) after an investigation found they had provided hundreds of subcontractors with contracts missing legally required information and reduced supply prices through promotional discounts that were not included in their agreements.
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