Epic Games wins its antitrust case over Google’s Play Store

Fortnite maker Epic Games’ antitrust trial wins against Google leveled the battle to democratize app stores.

A nine-person jury concluded yesterday (December 11) that Google’s Play Store operates as an illegal monopoly, which unanimously answers “yes”. all 11 questions on the sentence form. The jurors said Google has monopoly power over the Android app distribution and billing services markets, in violation of antitrust laws “worldwide excluding China,” where it is prohibited. They also agreed that Epic suffered as a result.

“Today’s ruling is a victory for all app developers and consumers around the world. This proves that Google’s app store practices are illegal and they are abusing their monopoly to extract exorbitant fees, stifle competition and reduce innovation,” Epic shared in a blog post. The video game maker called for “legislation and regulations that address Apple and Google strangleholds on smartphones.”

However, this battle has gone beyond Google and Epic. “It could end up being a huge shakeup,” a guest predicts on the forum run by startup incubator Y Combinator. The basics of Google’s app store economics have been called into question, paving the way for an overhaul. Google may be forced to allow other companies to set up competing payment systems in the Play Store, among other things.

But first, Google will challenge the ruling, Wilson White saidvice president of government affairs and public policy at the Alphabet company.

Google’s app store monopoly, by the numbers

95%: Part of apps distributed via the Play Store on Android.

3%: How much Epic saved by not using a payment processor, according to CEO Tim Sweeney’s testimony

$398,931.23: Fees not paid by Epic that Google would have received if the independent Epic transactions were processed through Google Play’s billing system instead

4%: Commission that Spotify pays Google – much less than the typical 15% – as part of a secret agreement. Google should be in the good books of the world’s largest music streaming platform

10%: The special discounted rate that Google offered Netflix, which refused. The video streaming giant doesn’t have an in-app purchase option on Android, so it no longer pays Google anything to distribute its app

Citable: Google’s tight grip on its app store

“I want everyone to see and understand that Google exercises de facto control over the availability of apps on Android.”

—Tim Sweeney, CEO of Epic Games, during his November testimony

A brief timeline of Epic Games versus Google

August 2018: Epic take Fortnite from Google’s Play Store About the technology titan, app developers charge a 30% fee for purchases made in the store. Unlike Apple’s iOS operating system, Android allows people to install apps directly from any source.

April 2020: Fortnite reluctantly return to the Play Store. Epic CEO Sweeney says Google puts software downloaded outside the store at a “disadvantage,” accusing it of using “scary, repetitive security pop-ups” and other intimidation tactics to steer users away from third-party offers.

August 13, 2020: Epic adds a new direct payment option for in-game currency on mobile, which comes at a 20% discount compared to purchases from Apple or Google’s app stores, because it “passes payment processing savings on to you.” Epic has taken down both stores and is suing Apple and Google.

September 2021: A federal judge rejects most of Epic’s arguments in its antitrust case against Apple. Later, in Google’s case, a jury of nine people—not a judge—will decide his fate.

September 2023: Google settles with a dozen US state attorneys generalwho sued for similar reasons.

November 2023: Narrow the scope of a courtroom fight, Google match with Match Groupthe online dating giant whose apps include Tinder, Hinge and Match.

December 8, 2023: Google and Epic are making a last ditch effort to settle their case, but no agreement is reached.

December 11, 2023: A jury rules that Google’s Play Store operates as an illegal monopoly.

One more thing: PhonePe’s challenge to Google in India

Walmart-owned digital payments firm PhonePe is launching a mobile app store with no fee on in-app purchases. Apps on the Indus Appstore will be free for the first year, followed by a “nominal” annual fee, PhonePe CEO Sameer Nigam said. Developers will be able to list apps in 12 Indian languages ​​in addition to English, and integrate any payment gateway of their choice on the platform.