Fresh off a landmark legal defeat last week, Google has now agreed to settle a separate suit by a coalition state attorneys general – co-led by New York AG Letitia James — accusing the tech giant of monopolistic conduct in its app store that increases costs for consumer and developers.
Google will hand over $630 million in restitution to consumers who made purchases on the Google Play Store between August 2016 and September 2023 and were harmed by Google’s anticompetitive practices. It will pay the states $70 million for their claims. Eligible consumers will be notified of the settlement and receive payments through PayPal, Venmo, check or ACH transfer.
For much of the case, the attorneys general litigated alongside Epic Games and Match. Match announced a separate settlement earlier this year. Epic Games took its case to trial. A jury unanimously found that Google’s anticompetitive conduct violated the federal antitrust laws early last week.
In a statement today, Epic called the settlement lacking. “The State Attorneys General settled with Google before trial to get a one-time payout with no true relief for consumers or developers. After originally seeking $10.5 billion in antitrust damages identified as Google’s unjustly collected fees, the States Attorneys General settled for a $700 million payout,” said the VP of public policy for the company behind Fortnite.
“Consumers will continue to overpay for digital goods as a result of Google’s imposition of supracompetitive 30% fees for Google Play Billing or 26% junk fees on top of payments Google isn’t involved in processing. Developers will also continue to be restricted in how they distribute their apps, and developers who choose to use a third party payment option will be forced to use Google’s deceptively-labeled “user choice billing” system rather than having creative freedom over the design of their payment systems.”
“In Epic v. Google, a jury unanimously found that Google violated the antitrust laws in its dealings with developers, potential competitors, and OEMs. The States’ settlement does not address the core of Google’s unlawful and anticompetitive behavior. In the next phase of the case, Epic will seek meaningful remedies to truly open up the Android ecosystem so consumers and developers will genuinely benefit from the competition that U.S. antitrust laws were designed to promote.”
Other cases are pending. James is co-leading a suit by 38 attorneys general for Google alleged monopoly power in search services and search advertising. The AGs and the Department of Justice took the case to trial in the U.S. District Court in Washington, D.C.
New York is also a plaintiff in a case against Google alleging that the company monopolized the components of the “adtech stack” used to buy and sell digital display ads.
Meanwhile, the settlement announced today calls for Google to make the following changes:
-Give all developers the ability to allow users to pay through in-app billing systems other than Google Play Billing for at least five years.
-Allow developers to offer cheaper prices for their apps and in-app products for consumers who use alternative, non-Google billing systems for at least five years.
-Permit developers to steer consumers toward alternative, non-Google billing systems by advertising cheaper prices within their apps themselves for at least five years.
-Not enter into contracts or enforce provisions that require the Play Store to be the exclusive, pre-loaded app store on a device or home screen for at least five years.
-Allow the installation of third-party apps on Android phones from outside the Google Play Store for at least seven years.
-Revise and reduce the warnings that appear on an Android device if a user attempts to download a third-party app from outside the Google Play Store for at least five years.
-Maintain Android system support for third-party app stores, including allowing automatic updates, for four years.
-Not require developers to launch their app catalogs on the Play Store at the same time as they launch on other app stores for at least four years.
-Submit compliance reports to an independent monitor who will ensure that Google is not continuing its anticompetitive conduct for at least five years.
