SAN FRANCISCO: Alphabet Inc. is set to pay $700 million and revise its Google Play policies to resolve claims that the app store unlawfully dominates the Android mobile applications market, aims to address antitrust complaints brought by attorneys general of approximately three dozen states and consumers.
As part of the deal, adjustments to Google Play policies will be implemented to diminish barriers to competition in the app distribution and payment processing markets. The lawsuits, consolidated in a federal court in California, posed a significant threat to the billions of dollars in revenue generated through the sale and distribution of apps via Google Play.
The settlement, detailed in the filing, emphasizes modifications to Google Play policies that are geared towards fostering a more competitive environment. This includes changes to app distribution and payment processing to open up avenues for increased competition. The legal actions, which had been looming over Google, were a result of allegations that the tech giant utilized anticompetitive strategies to stifle competition, compelling developers to exclusively use the Google Play store to access users.
Wilson White, Google’s vice president for Government Affairs and Public Policy, commented on the settlement, stating, “This settlement builds on Android’s choice and flexibility, maintains strong security protections, and retains Google’s ability to compete with makers of other operating systems and invest in the Android ecosystem for users and developers.”
Earlier this month, a federal jury in San Francisco ruled in favour of Epic Games Inc., supporting its claims that Google Play’s app distribution, payment, and fee policies were unlawful. The state attorneys general had accused Google of engaging in anticompetitive practices to block rivals and ensure developers had no alternative but to use the Google Play store.
In a separate class-action lawsuit representing nearly 21 million consumers, Google faced allegations of artificially inflating Android app prices by taking a substantial cut, up to 30 percent, of Google Play transactions.
Alphabet had previously announced a tentative settlement in September, withholding financial details. The recent filing indicates that all 50 states, the District of Columbia, and two U.S. territories have now joined the accord.
Additionally, a $630 million common fund will be established to benefit consumers, along with a $70 million fund to address state claims for penalties, restitution, disgorgement, and fees. This settlement follows a prior resolution with Match Group Inc. ahead of the trial with Epic in San Francisco that commenced in early November.
