South Korea 'puts the brakes' on Google's app store dominance
Starts monitoring developer deals after first slapping the G-force with substantial fine
South Korea's Fair Trade Commission today commenced monitoring of Google's app store operations – an action that follows its April decision to fine the advertising and mobile OS giant for its competition-crimping activities.
A Wednesday statement from the Commission brought news that in late July it wrote to Google to inform it of the ₩42.1 billion ($31.5 million) fine announced, and reported by The Register, in April 2023.
The Commission has also commenced monitoring activities to ensure that Google complies with requirements to allow competition with its Play store.
South Korea probed the operation of Play after a rival local Android app-mart named OneStore debuted in 2016.
OneStore had decent prospects of success because it merged app stores operated by South Korea’s top three telcos. Naver, an online portal similar in many ways to Google, also rolled its app store into OneStore.
Soon afterwards, Google told developers they were free to sell their wares in OneStore – but doing so would see them removed from the Play store.
Google also offered South Korean developers export assistance if they signed exclusivity deals in their home country.
Faced with the choice of being cut off from the larger markets Google owned, developer enthusiasm for dabbling in OneStore dwindled. Some popular games never made it into OneStore, so even though its founders had tens of millions of customers between them, the venture struggled.
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Which is why Korea's Fair Trade Commission intervened with an investigation, the fines mentioned above, and a requirement that Google revisit agreements with local developers.
Google has also been required to establish an internal monitoring system to ensure it complies with the Commission's orders.
Commission chair Ki-Jeong Han used strong language in today's announcement, describing his agency's actions as "putting the brakes" on Google's efforts to achieve global app store dominance.
"Monopolization of the app market may adversely affect the entire mobile ecosystem," the Commissioner's statement reads, adding "The recovery of competition in this market is very important."
It's also likely beneficial to South Korean companies. OneStore has tried to expand overseas, and Samsung – the world's top smartphone vendor by unit volume – also stands to gain. It operates its own Galaxy Store that, despite its presence on hundreds of millions of handsets, enjoys trivial market share. ®