Google consented to a $700 million settlement over allegations of stifling competition in its Android app store, ABC News reported Tuesday.
The terms of the settlement, revealed late Monday, follow a federal jury’s ruling that Google is guilty of anticompetitive tactics in the Google Play Store, according to ABC News. The case revolves around the same issues raised in another trial, potentially leading to even more substantial changes.
The bulk of the settlement is earmarked for U.S. consumers as compensation. These funds address overcharges in digital transactions within apps downloaded from the Play Store, due to Google’s control over the payment processing system, ABC News reported.
Google agrees to pay $700m after antitrust settlement with consumers and US states https://t.co/QFg6NJnyUI
— Guardian news (@guardiannews) December 19, 2023
Like its counterpart Apple, Google imposes a 15% to 30% commission on in-app purchases. State attorneys argued that these fees inflated prices. This commission system is a significant profit generator for Google. Consumers eligible for compensation will be notified about their share of the $630 million fund, accodring to ABC News. Additionally, $70 million of the settlement will cover penalties and other costs.
Google has agreed to make it easier to download and install Android apps from alternative sources for the next five years. Google will reduce the use of security warnings when non-Play Store options are utilized, according to ABC News. (RELATED: 36 States Sue Google Over Alleged Anticompetitive Practices In Play Store)
Brian Schwalb, Washington D.C. Attorney General, praised the settlement as a victory for Android users, ABC News reported. He emphasized that Google’s practices had long restricted user choices and led to artificially high prices.
However, not all are satisfied with the settlement. Epic Games, the maker of Fortnite, has rejected the agreement, opting to continue its antitrust lawsuit against Google. This lawsuit follows Epic’s similar but unsuccessful action against Apple in 2021.