Google Fined €102M in Italy for Anti-Competitive Behavior

Alphabet (GOOGL) is to pay €102.08 million for abusing its dominant market position with the Android operating system and the Google Play app store. According to the Italian Competition Authority, the Internet giant has been using its influence to control app developers’ access to end-users.

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The €102.08 million fine stems from claims the Internet giant denied Enel X Italia an opportunity to develop a version of its JuicePass compatible with Android Auto. According to the regulator, the blockade made it impossible for end-users to use the Enel X Italia app while driving and recharging their electric cars.

The regulator further alleges that the actions favored Google Maps, which runs on Android Auto and is a direct competitor to Enel X Italia’s JuicePass. The exclusion of the Italian navigation app from Android Auto has been ongoing for more than two years. If left to continue, the Italian Competition Authority fears it could jeopardize Enel X Italia’s ability to build a solid user base as electric vehicle adoption in Italy continues to grow.

The anti-trust authority fears that if left unchecked, the Internet giant’s actions could significantly influence the development of the electric vehicle market in Italy. In addition to the fine, the anti-trust authority has articulated the behavior that the Internet giant will have to adopt.

Google will now have to offer all the relevant tools compatible with Android Auto to Enel X Italia and other developers. The Internet giant is also tasked with monitoring the implementation of the imposed obligations. (See Alphabet stock analysis on TipRanks).

Following Alphabet’s impressive Q1 results, KeyBank analyst Justin Patterson reiterated a Buy rating on the stock. According to the analyst, the company has demonstrated it has what it takes to continue posting revenue growth.

Patterson stated, “We view Alphabet as a consistent revenue growth compounder in the digital advertising space due to its breadth of 1B+ user properties (e.g., Search, YouTube, Maps). Further, we see an opportunity for more value to be realized through monetization of non-advertising services such as Cloud, hardware, and the Other Bets portfolio (most notably Waymo and Verily).”

The analyst has a $2,681 price target, implying 20.3% upside potential to current levels.

Consensus among analysts on Wall Street is a Strong Buy based on 28 Buy and 2 Hold ratings. The average analyst price target of $2,769.59 implies 24.25% upside potential to current levels.