Google settles for $700 Million in Play Store antitrust case

Google‘s parent company, Alphabet Inc., is will pay $700 million to settle antitrust claims related to the dominance of its Google Play store in the Android mobile applications market. This settlement resolves legal complaints brought by attorneys general from about three dozen states and consumers. A federal court in California consolidated the lawsuits and posed a significant threat to Google’s revenue generated through the sale and distribution of apps on the Google Play platform.

The settlement, disclosed in a court filing, outlines that Alphabet will modify its Google Play policies to address concerns of unlawfully dominating the Android mobile applications market. The changes are designed to allow choices and bring openness to Google Play regarding app distribution and payment processing.

The legal battles centered on allegations that Google used anticompetitive tactics to block competition, ensuring that developers had no alternative but to use the Google Play store to reach users.

State attorneys general accused Google of inflating Android app prices by taking up to 30% cut, from Google Play transactions.

Earlier this month, a federal jury in San Francisco ruled in favor of Epic Games Inc. in a case that challenged Google Play’s app distribution, payment, and fee policies. The jury sided with Epic Games, affirming that Google’s practices were unlawful.

As part of the settlement, Google will contribute $630 million to a fund that benefits consumers and an additional $70 million to resolve state claims for penalties, restitution, disgorgement, and fees. The lawsuit aims to address the funds to the grievances of consumers and the states involved in the legal action.

Apart from the financial settlement, Google has agreed to make changes to its Android platform, introducing a simplified sideloading process and updated language to inform users about potential risks when downloading apps directly from the web. Additionally, the company will clarify that original equipment manufacturers (OEMs) can provide users with options to use either the Google Play store or another app store out of the box.

These changes will take effect after formal court approval of the settlement. It’s important to note that this settlement is separate from the ongoing jury trial involving Epic Games, where the court found Google to have an “illegal monopoly.”