Home Strategy Australian start-up blames Google as it goes into administration
Australian start-up blames Google as it goes into administration Featured

Australian mobile rewards platform Unlockd has gone into voluntary administration, with the company blaming Google for its inability to raise the funds it expected from an IPO which was put off due to threats from the search giant.

In April, the start-up was forced to put off its planned IPO when Google threatened to remove its apps from the Play Store, with the alleged reason being that Unlockd did not conform to Google's policies.

The Australian firm then obtained court injunctions from the British High Court and the Australian Federal Court, preventing Google from disabling AdMob-generated advertising content and removing Unlockd apps for the company's UK business from the Google Play Store.

But on Tuesday, the company apparently decided that it could not carry on in this fashion.

In a statement, Unlockd said: "...the ramifications of Google’s actions have had and continue to have a deep impact on the business when considering the valuation of Unlockd prior to these threats and the postponement of the planned IPO, which would have fuelled the continued growth and expansion of the business.

"As such, we have not been able to secure the capital we had expected to replace the IPO and therefore have been left no choice but to move into voluntary administration."

The two companies first got into conflict earlier this year, when Google claimed that the start-up was violating its terms of service, even though clear explanations had been provided on how its apps could be made compliant with Play Store rules.

Unlockd's business model is built around consumers agreeing to view content on their mobile screens when they unlock their phones. In exchange, users get rewarded in different ways, such as getting discounts on their monthly mobile bills.

Its apps run only on the Android operating system meaning that the threat by Google, if carried through, would more or less cut off its blood supply.

Unlockd returns about 70% of the ad revenue it gets to its users, while Google, which dominates the mobile ad market, does not offer a cent back.

In its statement, Unlockd said: "We believe that Google’s conduct and the effect of its actions represents a further example by them of anti-competitive conduct toward innovative start-ups such as Unlockd, that might pose a future threat to their position in the market.

"Until wide-reaching change is brought about to prevent companies like Google from abusing their dominant market positions, consumers and innovation will continue to suffer."

The Australian Competition and Consumer Commission is currently conducting an inquiry into digital platforms and the Unlockd case may make it to the organisation's radar.

Contacted for comment, a Google spokesperson referred iTWire to a statement issued on 17 April, which read: “Our publicly available AdMob and Google Play policies clearly set out how our products may be used, and are designed to protect the interests of advertisers, publishers and phone users.

"We explained our concerns to Unlockd, outlined how they could fix the problems or use alternatives, and gave them time to make changes. And despite having agreed at the outset to comply with our product policies, their app remains in infringement today."

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A professional journalist with decades of experience, Sam for nine years used DOS and then Windows, which led him to start experimenting with GNU/Linux in 1998. Since then he has written widely about the use of both free and open source software, and the people behind the code. His personal blog is titled Irregular Expression.

 

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