The South Korean Fair Trade Commission (KFTC) has fined Alphabet’s Google 42.1 billion won (~$32 million) for blocking developers from releasing mobile video games on a Korean competitor platform called One Store.
On Tuesday, the KFTC said Google reportedly required Korean video game companies to release their new games exclusively on the Play Store from June 2016 to April 2018. That means Google banned local game makers from releasing their content on One Store in exchange for offering Google’s in-app exposure and further support for global expansion.
One Store, a local peer of Google’s Play Store, was founded in June 2016 by South Korea’s three telcos – SK Telecom, KT and LG Uplus – and internet giant Naver.
Google’s local market share of the Android mobile app market rose to about 90% to 95% in 2018, up from about 80% to 85% in 2016, while One Store’s market share accounted for about 5% to 10% % in 2018, which dropped from 15% to 20% in 2016, according to data collected by the KFTC.
Korea’s antitrust watchdog said the move is part of an effort to ensure fair competition in the app market by preventing the US tech giant from abusing its dominant position.
According to the KTVC press release, Google Play and One Store generate more than 90% of domestic revenue from game sales. Google’s activity impacted the gaming companies, from large video game makers like NCSoft, Netmarble and Nexon to small and medium game developers, according to the KFTC.
“We have diligently cooperated with the KFTC’s investigation and deliberation process over the past five years and believe there has been no violation of law,” a Google spokesperson said in an emailed statement. “Google invests substantially in developer success and we respectfully disagree with the KFTC’s conclusions. We will carefully review the final written decision once shared with us to evaluate next action.
In 2021, the KFTC fined Google $177 million for abusing its market dominance in the Android operating systems (OS) market.
Google claims it has contributed to the growth and successful global expansion of the Korean mobile game developers who have launched their games on Play over the past decade.