Google butts head with Russian authorities

Google has been ordered by Russian regulators and courts to substantially change the way it does business in the country, threatening its advertising income streams.

Russia's Federal Anti-Monopoly Service (FAS) competition regulator has ordered Google to amend its contractual agreements with smartphone makers, to stop the online giant from steering Android users towards its own services ahead of those of third-party providers.

FAS found last month that Google had abused its dominant market position and violated competition law, following a complaint filed by Russian search and online portal Yandex. 

Google now has one month to change the contracts with smartphone makers and remove what the Russian regulator says are anti-competitive clauses, the regulator said yesterday.

If Google fails to comply with the FAS order, it risks fines in Russia of up to 15 percent of its 2014 annual revenue.

Separately, a court in Moscow has banned Google from parsing Gmail users' email messages to serve up targeted AdWords advertisements.

The Moscow City Court agreed with a Russian lawyer's complaint that Google's machine analysis of emails amounted to a violation of the country's privacy and confidentiality laws.

Lawyer Anton Burkov took legal action against Google after discussing a trip to France with friends through Gmail messages. Burkov started receiving ads in his web browser about tourism in France, and complained this violated his constitutional right not to have his correspondence read by third parties.

Google has now been banned from serving up targeted, contextual advertising based on the content in users' email messages in Russia. The case may set a legal precedent in the country.

The online giant was also fined 50,000 rubles (A$1090).