Google To Pay $700m To Consumers In US Antitrust Settlement

Google is to pay $700 million (£550m) and allow more competition in its Play app store as part of an antitrust settlement with US states and consumers whose terms were disclosed in a San Francisco federal court on Monday.

Google is to pay $630m into a settlement fund for consumers and a separate $70m fund to be used by states. The settlement requires a judge’s final approval.

Roughly 102 million US consumers are eligible to receive payouts of $2 or more depending on their spending on the app store from 16 August 2016 to 30 September 2023.

The vast majority, about 71.4 million, will not need to file a claim in order to benefit from the agreement.

Image credit: Pawel Czerwinski/Unsplash

Play Store controls

Under the agreement Google also agrees to change the controls it places on how Android users are able to install apps from alternative app stores and use alternate payment methods outside its own Play Store billing system.

It is to expand for five years a pilot programme called user choice billing that allows users to choose between its proprietary billing system and a third-party channel. The programme has been in testing for more than a year.

Developers that take payments through third-party systems can receive a slight discount on Google’s commission fees of usually about 30 percent.

App makers will also be guaranteed for multiple years to be allowed to tell consumers about promotions, alternative billing systems, Google’s commissions and ways to avoid them.

‘Choice and flexibility’

Google is to simplify the process of installing apps outside the Play Store, including changing the warning messages displayed when users do so.

In agreeing to the settlement the firm did not admit wrongdoing.

“This settlement builds on Android’s choice and flexibility, maintains strong security protections, and retains Google’s ability to compete with other OS makers, and invest in the Android ecosystem for users and developers,” said Google vice president of government affairs Wilson White.

Lead plaintiff in the case Utah and other states announced in September that they had settled their lawsuit over the Play Store, but the terms were kept confidential ahead of a related trial between Google and Fortnite maker Epic Games.

Image credit: Unsplash

Epic antitrust win

That case ended last week when a California federal jury found in favour of Epic’s charges that parts of Google’s app distribution model broke competition laws.

Epic is expected to make its own proposals for changes to the Play Store to US District Judge James Donato next year.

Epic public policy head Corie Wright said the states’ settlement “did not address the core of Google’s unlawful and anticompetitive behaviour”.  The company was critical of Google’s user choice billing system during the trial.

Wright said in the next phase of its trial Epic would push to “truly open up the Android ecosystem”.

‘Could have won more’

Epic chief executive Tim Sweeney said on X, formerly Twitter, that states could have won a large damages award if they had “stayed in the fight a few weeks longer”.

Google faces other ongoing antitrust cases challenging its search and digital advertising practices, in all cases having denied wrongdoing.

Matthew Broersma

Matt Broersma is a long standing tech freelance, who has worked for Ziff-Davis, ZDnet and other leading publications

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