Google to settle PlayStore antitrust lawsuit in the US for $700 mn, to allow for greater competition

Alphabet’s Google has reached an agreement to settle an antitrust lawsuit in the United States, agreeing to pay $700 million and take measures to allow for better competition in the Android ecosystem, as far as its Play Store app marketplace is concerned.

The terms of the settlement were disclosed on Monday in a federal court in San Francisco, outlining Google’s commitment to fostering a more competitive environment.

According to a statement from the company, Google will allocate $630 million to a settlement fund for consumers and an additional $70 million to a fund designated for states.

The antitrust case centred around allegations that Google engaged in overcharging consumers by imposing unlawful restrictions on app distribution on Android devices and implementing unnecessary fees for in-app transactions. However, Google did not admit to any wrongdoing as part of the settlement.

While the settlement awaits final approval from a judge, lead plaintiff Utah and other states initially announced the resolution in September.

The terms were kept confidential until after Google’s trial with Epic Games, the creator of “Fortnite.” A California federal jury recently sided with Epic Games, affirming that certain aspects of Google’s app business exhibited anticompetitive behaviour.

In a statement, Wilson White, Google’s Vice President for Government Affairs and Public Policy, emphasized that the settlement “builds on Android’s choice and flexibility, maintains strong security protections, and retains Google’s ability to compete with other operating system makers, and invest in the Android ecosystem for users and developers.”

As part of the settlement, Google has committed to expanding the options for app and game developers, allowing them to offer consumers alternative billing choices for in-app purchases alongside Play’s existing billing system. The company noted that it had been testing “choice billing” in the US for over a year.

Additionally, Google pledged to simplify the process for users to directly download apps from developers. Looking ahead, Epic Games plans to request US District Judge James Donato, overseeing both cases, to issue an order that could compel Google to implement changes in its Play store.

While resolving this antitrust lawsuit, Google still faces legal challenges related to its search and digital advertising practices, maintaining its denial of any wrongdoing in those particular cases.

(With inputs from agencies)