Google on Tuesday confirmed a proposed settlement in a class action antitrust suit concerning the Google Play store. The lawsuit alleged that Google violated antitrust rules by overcharging customers. 50 state attorney generals settled with Google in September, and we’re now learning the terms.
The company has agreed to pay $700 million, $630 million of which will be split between the consumers in the class action, after taxes and fees. The remaining $70 million will go to the states, where the AGs will decide how to use the money.
The lawsuit isn’t related to Epic Games’ recent win against Google on related Play Store matters. Like the Epic case, the new settlement might impact how Google operates the official Android store in the coming years.
Looking at the 68-page settlement, The Verge listed some of the things Google is agreeing to in regards to the Play store. Here are a few, which sound a lot like The Twelve Days of Christmas:
- For 7 years, Google will “continue to technically enable Android to allow the installation of third-party apps on Mobile Devices through means other than Google Play.”
- For 5 years, Google will let developers offer an alternative in-app billing system next to Google Play (aka “User Choice Billing”)
- For 4 years, Google won’t make developers ship titles on Google Play at the same time as other stores and with feature parity
- For 5 years, Google won’t make companies exclusively put Google Play on a phone or its homescreen
- For 6 years, Google will let consumption-only apps (e.g., Netflix, which doesn’t let you pay on your device) tell users about better prices elsewhere without linking to an outside website — for example: “Available on our website for $9.99.”
- For 6 years, Google “shall not prohibit developers from disclosing to Users any service or other fees associated with the Google Play or Google Play’s billing system.”
These are just some of the various things Google has agreed to, as summarized by The Verge. But the blog argues these are not real concessions that Google is making.
For example, Google will continue to block developers like Netflix from linking to their own websites in apps to give customers discounted apps.
“Google is not required to allow developers to include links that take a User outside an app distributed through Google Play to make a purchase,” the settlement agreement reads.
As for the User Choice Billing, a spokesperson has told the blog that developers will get a discounted rate of 4% off of Google’s 30% fee when they choose their own payment option instead of Google’s. The Verge points out that Google internally found that developers would be losing money with the 4% discount.
Unsurprisingly, Epic’s Tim Sweeney did not like the proposed settlement, complaining on Twitter about that 26% Google tax.
Google, meanwhile, has its own blog post addressing the proposal in the settlement.
A court will have to approve it before it enters into effect. If you’re part of the class action, you’ll have to wait for a cut of that $700 million fine. Well, $630 million.
Small as these concessions might be, the settlement might change how mobile app stores work in the US. There’s also the fallout from the Epic win against Google that might impact app stores.
I use the plural here, as Apple also operates a highly popular App Store, whose rules some consumers and developers have been protesting. Epic, however, has not been able to defeat Apple in a similar case.
