Google to stop bundling apps on smartphones in European Union nations

A 3D-printed Android mascot Bugdroid is seen in front of a Google logo in this illustration taken

In the new agreement, phone makers will have to pay a fee if they want those apps, but the amount has not been settled, CNBC reported.

The tech giant said Tuesday it will also will start charging a licensing fee for those who want to install apps on Android phones in European Union territories - like Gmail, Maps and YouTube.

Companies can offset the charge, which applies to a suite of apps including the Google Play app store, Gmail and Google Maps, by placing Google's search and Chrome internet browser in a prominent position.

But Google has said that it will have to impose a new licensing fee on manufacturers as a effect of the ending of its restrictions.

It's unclear why pixel density is so central to the pricing scheme, but it is likely being used as a proxy for the price of the overall device, as higher pixel density devices usually cost more. It's possible that some manufacturers could negotiate separate deals, but a source familiar with the structure said it's unlikely they would vary significantly. Use of popular Google app such as YouTube, Gmail and most especially the Play Store could attract charges for companies in Europe. According to the new agreement, Google would not pay search revenue sharing for devices that do not preinstall Chrome and place it in the phone's home screen dock.

You can read Google's explanation here.

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The European Commission ruling does not explicitly require Google to charge licensing fees, but Google is required to break apart its traditional bundle of apps. Antitrust regulators in Europe fined Google $5 billion for its illegal practices. "Given the choice, Android handset makers will continue installing both Google Search and Google Chrome on their Android devices as the alternative would seem to be economic suicide".

The new fee goes into effect on October 29 for any new smartphone or tablet models launched in the European Economic Area and running Google's Android operating system, the company announced on Tuesday. It means companies will now be able to add the aforementioned apps without adding Chrome and search.

However, the Verge reports that phone manufacturers may be able to escape some - or all - of these costs if they choose to make Google's Chrome web browser and Search engine their device defaults.

Critics of the commission's judgment see it as a new cost to be passed on to consumers, a view that may be driven home by the new licensing fees.

Android of course, is being offered as a free OS for companies, but that could change pretty soon considering the latest development.

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