Google Fined AU$55 Million for Anti-Competitive Deals with Telstra and Optus

Google has agreed to pay a fine of 55 million Australian dollars (approximately US$36 million) after admitting to entering anti-competitive agreements with Australia’s two largest telecom providers, Telstra and Optus. The Australian Competition and Consumer Commission (ACCC) announced the development on Monday, stating that the deals reduced competition in search services and limited consumer choice across the country.

The ACCC revealed that between late 2019 and early 2021, Google’s Asia-Pacific division, based in Singapore, signed contracts with Telstra and Optus that barred them from installing rival search engines on Android devices sold to customers. These agreements, which lasted around 15 months until March 2021, guaranteed that Google Search remained the default option. In return, the telcos received a share of advertising revenue generated by users’ search activities.

Google has acknowledged that the deals likely had the effect of significantly reducing competition. Proceedings have been initiated in the Federal Court to determine whether the AU$55 million penalty is suitable. Additionally, Google has entered into a legally binding undertaking to remove similar restrictive clauses from future contracts involving Android phone manufacturers and telecom partners.

ACCC Chair Gina Cass-Gottlieb welcomed the outcome, stating that the resolution represents a step forward for fairer competition and increased consumer choice. “Anti-competitive behaviour harms Australians by limiting options, raising costs, or reducing service quality,” she said. She added that the timing of these changes is crucial, especially as AI-driven search tools begin to reshape how people access information.

Under new provisions, Telstra, Optus, and TPG can now configure search services individually on devices, regardless of Google’s defaults. They are also free to enter agreements with other search engine providers. The case stems from a broader ACCC investigation launched during its Digital Platform Services Inquiry, which examined concerns about search defaults and consumer choice.

Cass-Gottlieb emphasized the importance of corporate cooperation with regulators to avoid lengthy litigation and to support a more competitive digital landscape. Last year, Telstra, Optus, and TPG gave court-enforceable commitments not to engage in similar arrangements with Google moving forward.