Google faces probe for monopolizing distribution of mobile games

By Baek Byung-yeul

Korea’s antitrust agency is investigating Google Korea over its alleged abuse of market dominance in the mobile gaming industry, sources said Sunday.

The Fair Trade Commission (FTC) is checking whether Google requested local gaming developers and distributors to release their games on its Play Store app store only, according to industry sources.

The FTC is currently conducting a survey of gaming companies on fair trade and distribution of their mobile games.

It is said that the FTC is looking into whether there were Android mobile games that were released through only one digital distribution platform among Google Play Store and the One Store. The One Store is a local app market, which has combined app stores of Korea’s top three telecom carriers — SK Telecom, KT and LG Uplus — and Naver’s App Store. It is only downloadable on mobile devices with an Android operating system.

It also asked if employees of an app market requested gaming companies not to register their games in other app markets and whether or not game companies received special giveaways or disadvantages.

Last year, NCSOFT’s “Lineage M” and Netmarble’s “Lineage 2: Revolution” were released in Google Play Store and Apple’s App Store excluding the One Store. They were the top two grossing games of last year. Other mobile games were rolled out first via Play Store and App Store while the One Store released them after some delay.

The FTC did not clearly state that it would investigate Google’s alleged abuse of market dominance, but it is reportedly inquiring whether or not Google’s trade practices are unfair. The FTC said it has secured some evidence of Google’s violations of the law.

It is estimated that Google recorded between 3 trillion won and 4 trillion won in sales last year, but Korea has failed to collect proper taxes from the company. Google distributed mobile apps made by Korean developers not via Google Korea but through Google Asia Pacific in Singapore so the company is not obliged to open its books on revenue and taxation here. Google collects a 30 percent fee for the mobile app market.