Google has agreed to pay $700 million to settle a class-action lawsuit that accused the tech giant of abusing its monopoly power over the Android app store. As part of the settlement, Utah will receive $15 million, which will be distributed to eligible consumers who purchased apps or in-app items from the Google Play Store. The settlement aims to resolve claims that Google violated antitrust laws and harmed consumers by charging excessive commissions and restricting competition.
Google Play Store Settlement Overview
Google to Pay $700M
The settlement covers consumers who made purchases from the Google Play Store between January 1, 2011, and November 21, 2021. Google will pay $700 million to create a fund that will be used to compensate the plaintiffs, pay the attorneys’ fees and costs, and support consumer protection initiatives. The settlement is subject to court approval and may take several months to finalize.
$15M to be Distributed to Utahns
Utah is one of the 37 states and territories that joined the lawsuit against Google. According to the Utah Attorney General’s Office, Utah will receive $15 million from the settlement fund, which will be allocated to eligible consumers who submit valid claims. The exact amount of individual payments will depend on the number and value of the purchases made by each consumer.
Purpose of Settlement
The settlement is intended to resolve the allegations that Google violated federal and state antitrust laws by imposing unfair and anti-competitive practices on the Google Play Store. The plaintiffs claimed that Google charged excessive commissions of up to 30% on app and in-app purchases, restricted app developers from offering alternative payment methods, and prevented consumers from accessing other app stores on their Android devices. The settlement aims to provide monetary relief to the affected consumers and ensure fair and open competition in the app market.
Details of the Settlement
Origins of the Lawsuit
The lawsuit was filed in December 2020 by a group of consumers who purchased apps or in-app items from the Google Play Store. The lawsuit was later consolidated with similar cases filed by other consumers and state attorneys general. The lawsuit sought to represent a nationwide class of consumers who were allegedly overcharged by Google and deprived of choice and innovation in the app market.
Allegations Against Google
The lawsuit alleged that Google abused its dominant position in the Android app market by imposing restrictive and anti-competitive policies on the Google Play Store. The lawsuit claimed that Google forced app developers to use its own payment system and charged them exorbitant commissions of up to 30% on every transaction. The lawsuit also claimed that Google prevented app developers from offering lower prices or alternative payment methods to consumers, and blocked consumers from accessing other app stores on their Android devices. The lawsuit argued that these practices violated the Sherman Act, the Clayton Act, and various state antitrust and consumer protection laws.
Terms of the Settlement
The settlement requires Google to pay $700 million to create a settlement fund that will be used to compensate the plaintiffs, pay the attorneys’ fees and costs, and support consumer protection initiatives. The settlement also requires Google to make several changes to its app store policies, such as reducing the commission rate to 15% for developers who earn less than $1 million per year, allowing developers to communicate with consumers about alternative payment methods, and providing more transparency and information about the Google Play Store. The settlement also prohibits Google from retaliating against developers who choose to offer alternative payment methods or distribute their apps through other app stores.
Impact of the Settlement
Improved Consumer Protection
The settlement is expected to benefit millions of consumers who purchased apps or in-app items from the Google Play Store. The settlement will provide monetary relief to eligible consumers who submit valid claims, and will also fund consumer protection initiatives that will educate and inform consumers about their rights and choices in the app market. The settlement will also enhance consumer welfare by promoting fair and open competition in the app market, which will lead to lower prices, higher quality, and more innovation.
Potential Changes to App Store Policies
The settlement may also have a significant impact on the app store industry, which is dominated by Google and Apple. The settlement may encourage other app developers and app store operators to challenge Google’s and Apple’s practices and demand more favorable terms and conditions. The settlement may also influence the outcome of other ongoing lawsuits and investigations against Google and Apple, such as the Epic Games v. Apple case and the antitrust probes by the U.S. Department of Justice and the European Commission.
Benefit for Utahns
The settlement will also benefit Utahns, who will receive $15 million from the settlement fund. The Utah Attorney General’s Office stated that the settlement would provide “meaningful relief” to Utah consumers who were harmed by Google’s practices. The office also stated that the settlement will protect Utah’s “thriving tech sector” and ensure that Utah app developers can compete on a level playing field. The office urged Utahns to visit the settlement website and file their claims as soon as possible.
