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Google still claimed to be blocking search rivals on Android, despite Europe’s antitrust action

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Mobile licensing changes made by Google this fall, when it tweaked terms for OEMs wanting to license its Android smartphone platform on devices destined for the European market, don’t appear to be offering succour to search rivals — despite being triggered by an antitrust ruling intended to reset the competitive playing field.

The European Commission found the search giant guilty of anti-competitive practices related to its Android platform this summer, slapping the company with a $5BN fine. The decision required Google cease practices judged to be illegally skewing the market and do so within 90 days.

It was the second such major EC antitrust finding against Google, after last year’s Google Shopping ruling, when the company was warned that having been found dominant in search it had a “special responsibility” to avoid breaching antitrust rules in any market it plays in.

Google disputes the Commission’s findings of competitive abuse in both cases, and has lodged legal appeals.

But the nature of competition law demands action in the meanwhile, given the threat of punitive penalties for any continued breach. So in October Google responded to the Commission’s Android ruling by updating its regional compatibility agreement to provide a route for OEMs to unbundle key services from the Android OS — rather than requiring its suite of Google apps be pre-loaded for devices to get the Play Store.

However it also incorporated licensing fees for some unbundled configurations (e.g. Android + Play Store). At the same time it said it would not charge any fee to include search or Chrome. And it said it was offering incentives for OEMs to place its eponymous, market dominating search engine (and/or browser) prominently on their devices — despite one of the behaviors the Commission judged illegal being payments Google had made to certain large manufacturers and mobile carriers to exclusively pre-install Google Search.

The Commission did not prescribe specific remedies for the anticompetitive behaviours it pegged to Android — saying it’s “Google’s sole responsibility to make sure that it changes its conduct in a way that brings the infringements to an effective end”.

Though it warned it would closely monitor the company’s conduct, noting that any finding of continued non-compliance would risk fresh fines — of up to 5% of the average daily turnover of Alphabet for each day of non-compliance.

The key word there is “effective” — in terms of what the Commission is watching for.

Meanwhile Google’s dominant position in search naturally makes it the smartphone consumer’s go-to choice — which in turn means there’s a natural incentive for device makers not to ditch Google as the search default. At least for mainstream devices.

But Google’s new European licensing terms for Android appear to be piling additional pressure on OEMs not to switch even for more experimental and/or regional device launches, according to privacy-focused search engine Qwant.

The suggestion is Google’s licensing changes have essentially blocked the launch of an Android device with Qwant search rather than Google as the default.

Pay to install

Its experience suggests Google’s initial ‘remedy’ — far from delivering an “effective end” to the competitive infringements the Commission found — is actively steering OEMs away from search alternatives and rival companies.

Qwant, a French startup, launched its non-tracking search offering back in 2013, and has been on a growth tear on its home turf in recent months — winning over high profile users in the public sector as concern has risen about Silicon Valley’s intrusive grip on user data.

The French National Assembly and the French Ministry of the Armed Forces Minister announced this fall they’d switch to Qwant instead of Google as their default.

Of course the startup is still a minnow compared to Google. But it’s growing: Qwant tracks queries rather than users (given it doesn’t track people), and it says it generated 2.6BN queries in 2016; which grew to 9BN last year; and is now on track to end this year with around 18BN queries.

“So if we think about it that means that last year we were three days of Google; this year six days of Google — not so bad!” says co-founder Eric Leandri.

“In France we have now more than 6% of the market,” he continues. “In Germany something like 2%. And we are still growing. We do growth of 20% by month for the last four months. The growth in our revenue is two digit too, by month.”

Earlier this year it had been hoping to make additional regional marketshare gains by securing a deal to be pre-loaded on Android smartphones destined for European markets. A spokesman tells us it has a framework agreement with Huawei. (The Chinese Android OEM is second only to Samsung in global marketshare terms, according to analysts.)

The Commission’s antitrust ruling opened the door to this possibility, given it banned Google from prohibiting OEMs from launching non-Google approved Android forks. So after the ruling things were looking good for Qwant, with the startup on the cusp of securing a device deal for a few European countries, as Leandri tells it. 

He blames Google’s licensing changes for putting the kibosh on a launch they’d been expecting to be able to announce in November. Early that month the startup pinged us to trail forthcoming news — of “a major partnership that will allow us to accelerate in the smartphone market” — only to go silent.

A few weeks later it got in touch again to say it had had to postpone the announcement.

“We are very near to one or two deals to be by default or in the list of search engines in some Android cell phone made by a very large Asian manufacturer… Just for Europe, and just for some countries in Europe but we are talking about 10 million or 20 million of cell phones,” says Leandri now.

“And when we have won the bid against Google in October then Google start to say that in Europe you have to pay $40 for Android. So now if you install Qwant you have to pay $40 and if you install Google they give you some cash.”

“Before it was impossible to bid against Google because Google was blocking everything. Now you can — but now the solution of Google is you have to pay $40 if you don’t install Google by default with Chrome just on the bar. You know the bar that is fixed on Android. And this is again an abuse of their dominant position,” he adds.

“Because if I want, for example, 10 million smartphones, the guy has to pay $400M to Google. Do you really think they will pay $400M to Google just to install Qwant?”

Google’s rebuttal of the Commission’s antitrust finding for Android has focused on claims that its approach of free licensing combined with a bundle of Google services has generally enabled competition to thrive in the mobile app ecosystem, as well as claiming lower prices are a “classic hallmark… of robust competition”.

Yet Qwant’s experience offers a clear counterpoint, underlining how challenging it remains to try to compete with Google’s core search business when the same company also dominates the smartphone market and can just throw the levers of Android’s licensing terms to configure how much ‘appetite’ OEMs have for investing in alternative search defaults (given tiny hardware profit margins in the Android space).

After Qwant won over Huawei to building a device with its search engine in prime position, Leandri says it was Google’s changes to the licensing terms for Android that threw a spanner in the works.

“After that pressure then the manufacturer doesn’t know how to react now,” he says, confirming he believes there’s currently no chance for the device to be launched. Not without further changes to how Android operates in the market — i.e. further regulatory intervention.

“So we will work a lot with the European Commission to stop that,” he adds. “But again, again my question is why Google goes that way?”

We reached out to Google to ask about the fees it would charge an OEM wanting to launch an Android device with Google Play but without Google search as the default in Europe.

We also asked how charging a fee for Android if OEMs don’t also bundle Google services can help increase competition, per the Commission’s intention.

At the time of writing Google had not responded to our questions.

We also reached out to Huawei for comment and will update this story with any response.

Even if Qwant and Huawei get their way, and European buyers in a handful of countries are able to choose to buy an Android device with a little search localization as its differentiating out-of-the-box twist, Leandri isn’t under any illusions that a majority of consumers will still switch back to Google of their own accord — given its dominance of search.

He reckons those who’d stick with a non-Google search choice might be as low as a third or 40%. 

But his point is that, as it stands, Qwant doesn’t even have the chance to try competing against the Google Goliath on its own terms. And he argues that’s simply not fair. 

“Google has billions to make advertisement to ask people to switch, right. And they can even do advertisement on the Play Store for zero because they control the Play Store. Why they don’t come back to a normal market where we are all on the same line and they just compete with advertisement, with pushing their products, with a better proposition of value. It’s crazy, it’s crazy!” he says.

“They have 95% of the market, and on that market they expect that if they don’t have the search by default there then they don’t do money with the Play Store. This is bullshit. They do billions of euros with the app on the Play Store each year. With the 30% that they take on the apps. So this is not true. This is not true, sorry.

“So right now this is our goal and my main work actually is just to obtain the right to have a fair competition — a simple, fair competition.”

“I don’t want to dismantle Google. I don’t want Google to be fined 10BN. I don’t care. The only thing I want is to have the right to have a fair competition,” he adds.

We asked the European Commission to respond to Qwant’s experience, and for an update on its monitoring of Google’s compliance with the Android antitrust ruling.

A spokeswoman declined to comment on an individual case but we understand the Commission has been sending questionnaires to market players as part of its compliance monitoring.

It’s clear the regulator’s intention with the Android decision was to expand consumer choice by creating opportunities for competition that didn’t exist before — including for rival search and browser providers to be able to compete on the merits with Google when it comes to pre-loading their products on Android devices.

So if the Commission’s monitoring efforts confirm instances where competition is being blocked, as appears the case here with Qwant, further interventions will surely follow.

Leandri also points out that Google made much the same arguments vis-a-vis ‘fair competition’ more than a decade ago — when it called for the then computing incumbent, Microsoft, not to stand in the way of Internet upstarts by bundling MSN search into its Internet Explorer web browser. 

“The market favors open choice for search, and companies should compete for users based on the quality of their search services,” said Marissa Mayer in 2006, then Google’s vice president for search products. “We don’t think it’s right for Microsoft to just set the default to MSN. We believe users should choose.”

“I totally agree with what they say in 2006! Just exchange Microsoft for Google and that’s it!” he says now, adding: “We have to fight because there is not a lot of other way. But I stop fighting tomorrow as soon as I have a fair competition.

“I’m not waiting for the Commission to make the competition. Right now the percentage of growth that I have in France it’s not based on the Commission who has won or not. It’s based on our value proposition.”

Leandri is also president of the Open Internet Project, a European organization whose members lobby for regulatory action to rein in what they view as Google’s abusive dominance of digital markets, and which was also involved in the Google Shopping complaints — though he points out that in the Android case three of the five complainants are American. 

“We are the only European. So the problem is not only for a small startup in Europe. Who, y’know, complained because ‘Google is so cool’. And we are so dumb. And so ridiculous. But the problem is for Oracle, it’s for the Fair Search. It’s not for kids.”

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European Parliament DDoSed after declaring Russia a sponsor of terrorism

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Enlarge / An iteration of what happens when your site gets shut down by a DDoS attack.

The European Parliament website was knocked offline for several hours on Wednesday by a distributed denial-of-service (DDoS) attack that started shortly after the governing body voted to declare the Russian government a state sponsor of terrorism.

European Parliament President Roberta Metsola confirmed the attack on Wednesday afternoon European time, while the site was still down. “A pro-Kremlin group has claimed responsibility,” she wrote on Twitter. “Our IT experts are pushing back against it & protecting our systems. This, after we proclaimed Russia as a State-sponsor of terrorism.”

While this post was being reported and written, the website became available again and appeared to work normally.

The pro-Kremlin group Metsola referred to is likely the one known as Killnet, which emerged at the start of Russia’s invasion of Ukraine and has posted claims of DDoS attacks in countries supporting the smaller nation. Targets have included police departments, airports, and governments in Lithuania, Germany, Italy, Romania, Norway, and the United States.

Shortly after Wednesday’s attack against the European Parliament started, Killnet members took to a private channel on Telegram to post screenshots showing the European Parliament website was unavailable in 23 countries. Text accompanying the images made a homophobic remark directed at the legislative body.

The outage occurred shortly after the parliament overwhelmingly voted to declare the Kremlin a sponsor of terrorism.

Members of the European Parliament “highlight that the deliberate attacks and atrocities committed by Russian forces and their proxies against civilians in Ukraine, the destruction of civilian infrastructure and other serious violations of international and humanitarian law amount to acts of terror and constitute war crimes,” the declaration stated. “In light of this, they recognize Russia as a state sponsor of terrorism and as a state that ‘uses means of terrorism.’”

The resolution was adopted with 494 votes in favor, and 58 against. There were 44 abstentions.

DDoS attacks typically harness the bandwidth of hundreds, thousands, and in some cases, millions of computers infected with malware. After coming into their control, the attackers cause them to bombard a target site with more traffic than they can accommodate, forcing them to deny service to legitimate users. Traditionally, DDoS has been among the crudest forms of attack because it relies on brute force to silence its targets.

Over the years, DDoSes have become more advanced. In some cases, the attackers can increase the bandwidth by as much as a thousand-fold using amplification methods, which send data to a misconfigured third-party site, which then returns a much larger amount of traffic to the target.
Another innovation has been designing attacks that exhaust the computing resources of a server. Rather than clogging the pipe between the website and the would-be visitors—the way more traditional volumetric DDoSes work—packet-per-second attacks send specifc types of compute-intensive requests to a target in an attempt to bring the hardware connected to the pipe to a standstill.

Metsola said the DDoS attacks on the European Parliament were “sophisticated,” a word that’s often misused to describe DDoSes and hacks. She provided no details to corroborate that assessment.

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Apple iPhone factory workers clash with police in China

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Enlarge / Workers walk outside Hon Hai Group’s Foxconn plant in Shenzhen, China, in 2010.

Violent worker protests have erupted at the world’s largest iPhone factory in central China as authorities at the Foxconn plant struggle to contain a COVID-19 outbreak while maintaining production ahead of the peak holiday season.

Workers at the factory in Zhengzhou shared more than a dozen videos that show staff in a standoff with lines of police armed with batons and clad in white protective gear. The videos show police beating workers, with some bleeding from their heads and others limping away from chaotic clashes.

Beijing’s strict zero-COVID regime has posed big challenges for the running of Foxconn’s Zhengzhou plant, which typically staffs more than 200,000 workers on a large campus in the city’s suburbs.

Wednesday’s unrest will heighten investor concerns about supply chain risk at Apple, with more than 95 percent of iPhones produced in China.

Problems at the plant earlier this month led Apple to cut estimates for high-end iPhone 14 shipments and to issue a rare warning to investors over the delays.

Two workers at the Foxconn factory said the protests broke out on Wednesday morning after Apple’s manufacturing partner attempted to deny bonuses promised to new workers put into quarantine before being sent to assembly lines.

“Initially they just went into the plant seeking an explanation from executives, but they [the executives] didn’t show their faces and instead called the police,” said one of the workers.

Another worker said there was growing discontent over the factory’s continued inability to curb a COVID outbreak, tough living conditions, and fear among staff that they would test positive.

Foxconn said the company would work with employees and the government to prevent further violent acts.

The company said it had always fulfilled its contracts and would continue to “communicate and explain” that to new staff. It said reports that the company had mixed COVID positive workers with those not yet infected were untrue.

Videos show workers flipping over carts on the Foxconn campus, charging into the factory’s offices and bashing a COVID testing booth. Live streams from the scene on Wednesday afternoon showed groups of workers milling about in a courtyard between buildings. Some workers were livestreaming the protests on social media until censors stepped in to cut off the broadcasts.

“The Foxconn situation raises concern for China’s leaders because it challenges the narrative of being a reliable supplier,” said Shan Guo at Plenum China Research. “It’s clear workers are not happy being locked down,” she said.

Foxconn has been working with the local government in Henan province, where the plant is located, to repopulate its assembly lines with new workers after a mass staff exodus late last month spurred by conditions at the plant.

Local officials have been tasked with helping send workers to the plant, which is a big taxpayer and was responsible for 60 percent of the province’s exports in 2019.

Ivan Lam, an analyst at Counterpoint Research, said Foxconn had already been shifting iPhone 14 production away from the Zhengzhou factory amid the COVID problems. He estimated the Zhengzhou plant’s share of total iPhone 14 production was down to about 60 percent today from about 80 percent before the outbreak began.

Apple did not immediately respond to requests for comment.

© 2022 The Financial Times Ltd. All rights reserved. Please do not copy and paste FT articles and redistribute by email or post to the web.

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Meta researchers create AI that masters Diplomacy, tricking human players

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Enlarge / A screenshot of an online game of Diplomacy, including a running chat dialog, provided by a Cicero researcher.

On Tuesday, Meta AI announced the development of Cicero, which it clams is the first AI to achieve human-level performance in the strategic board game Diplomacy. It’s a notable achievement because the game requires deep interpersonal negotiation skills, which implies that Cicero has obtained a certain mastery of language necessary to win the game.

Even before Deep Blue beat Garry Kasparov at chess in 1997, board games were a useful measure of AI achievement. In 2015, another barrier fell when AlphaGo defeated Go master Lee Sedol. Both of those games follow a relatively clear set of analytical rules (although Go’s rules are typically simplified for computer AI).

But with Diplomacy, a large portion of the gameplay involves social skills. Players must show empathy, use natural language, and build relationships to win—a difficult task for a computer player. With this in mind, Meta asked, “Can we build more effective and flexible agents that can use language to negotiate, persuade, and work with people to achieve strategic goals similar to the way humans do?”

According to Meta, the answer is yes. Cicero learned its skills by playing an online version of Diplomacy on webDiplomacy.net. Over time, it became a master at the game, reportedly achieving “more than double the average score” of human players and ranking in the top 10 percent of people who played more than one game.

To create Cicero, Meta pulled together AI models for strategic reasoning (similar to AlphaGo) and natural language processing (similar to GPT-3) and rolled them into one agent. During each game, Cicero looks at the state of the game board and the conversation history and predicts how other players will act. It crafts a plan that it executes through a language model that can generate human-like dialog, allowing it to coordinate with other players.

A block diagram of Cicero, the <em>Diplomacy</em>-playing bot, provided by Meta.
Enlarge / A block diagram of Cicero, the Diplomacy-playing bot, provided by Meta.

Meta AI

Meta calls Cicero’s natural language skills a “controllable dialog model,” which is where the heart of Cicero’s personality lies. Like GPT-3, Cicero pulls from a large corpus of Internet text scraped from the web. “To build a controllable dialogue model, we started with a 2.7 billion parameter BART-like language model pre-trained on text from the internet and fine tuned on over 40,000 human games on webDiplomacy.net,” writes Meta.

The resulting model mastered the intricacies of a complex game. “Cicero can deduce, for example, that later in the game it will need the support of one particular player,” says Meta, “and then craft a strategy to win that person’s favor—and even recognize the risks and opportunities that that player sees from their particular point of view.”

Meta’s Cicero research appeared in the journal Science under the title, “Human-level play in the game of Diplomacy by combining language models with strategic reasoning.”

As for wider applications, Meta suggests that its Cicero research could “ease communication barriers” between humans and AI, such as maintaining a long-term conversation to teach someone a new skill. Or it could power a video game where NPCs can talk just like humans, understanding the player’s motivations and adapting along the way.

At the same time, this technology could be used to manipulate humans by impersonating people and tricking them in potentially dangerous ways, depending on the context. Along those lines, Meta hopes other researchers can build on its code “in a responsible manner,” and says it has taken steps toward detecting and removing “toxic messages in this new domain,” which likely refers to dialog Cicero learned from the Internet texts it ingested—always a risk for large language models.

Meta provided a detailed site to explain how Cicero works and has also open-sourced Cicero’s code on GitHub. Online Diplomacy fans—and maybe even the rest of us—may need to watch out.

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