Google dinged with $32M fine in South Korea for blocking mobile games on rival app store

The news: Google was fined 42.1 billion won ($32 million) by South Korea’s Fair Trade Commission (KFTC) for blocking mobile video game developers from a rival Korean mobile app platform called One Store, per TechCrunch.

• South Korea is Google Play’s third-biggest market behind the US and Japan.
• One Store, which was founded in June 2016, belongs to a conglomerate of South Korea’s three telecom providers—SK Telecom, KT, and LG Uplus—and internet provider Naver. 

More than a slap on the wrist: The fine is a result of Google’s alleged efforts to require Korean video game companies to exclusively release new games on the Play Store from June 2016 to April 2018.

• Regulators say Google blocked local game developers from releasing their content on the competing One Store in exchange for in-app exposure and promises of support for global expansion.
• Google grew its South Korean mobile market share from 90% to 95% in 2018.
• Meanwhile, One Store’s market share accounted for about 5% to 10% in the same time period, falling from 15% to 20% in 2016.

Repeat offender: This isn’t the first time Google has faced regulatory scrutiny in South Korea.

• The KFTC fined Google 207.4 billion won ($177 million) in 2021 for abusing its dominant position in the Android market by restricting device makers from using rival operating systems.
• This time around, the KFTC said Google’s activity derailed larger mobile video game makers such as NCSoft, Netmarble, and Nexon, as well as small and mid-size companies.

Google’s response: “Google makes substantial investments in the success of developers, and we respectfully disagree with the KFTC’s conclusions. We believe that there has been no violation of the law,” a spokesperson at Google said. 

Our take: Google—which is facing various antitrust charges outside the US, including $160 million fine in India and $155 million in the UK—is treading on dangerous ground and could incite intensifying regulatory scrutiny at a time when it’s scrambling for economic recovery and cutting costs.

This article originally appeared in Insider Intelligence's Connectivity & Tech Briefing—a daily recap of top stories reshaping the technology industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.

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