The $700 million payment is part of a deal to make tiny changes to the app store
Google and the State AGs Settlement: Google’s App Store Cannot Be Distributed Through Google Play Unless It’s Cooperating with an Alternative Payment System
Google’s app store has been in the crosshairs of lawmakers around the world. In both South Korea and the European Union, laws have been passed mandating that Google open up its app store by doing things like allowing consumers to download and pay for apps directly from developers.
The tech giant said it will also simplify the process of making apps available for download outside of its own app marketplace, known as the Google Play store.
While states announced a settlement with Google back in September, the details were unknown until the company publicly revealed the terms of the agreement on Monday.
More than 40 states brought legal action against the tech giant, and will be getting $70 million in payments from the settlement fund.
Apple’s app store on the phone has been scrutinized in lawsuits by policymakers and it is similar to the one they have on the internet. Apple’s app store policies were the subject of a lawsuit by Epic Games. In September 2021, a federal judge largely sided with Apple, but Epic Games is appealing the ruling to the U.S. Supreme Court.
A federal judge will hold hearings in January about what changes Google must make in order to remedy the anti-trust issues raised in court at the trial.
Google, one of the most valuable companies in the world, is now confronting more antitrust challenges than it ever has, as several other legal battles over whether the company abuses its immense power remain pending. Among them, a case brought by the Justice Department centered on Google allegedly breaking the law in maintaining its dominance of online search and advertising.
In an official blog post, Google writes it will roll out “User Choice Billing” more broadly after the court approves the settlement. It was previously available to game developers in South Korea, and will be rolled out to game developers in Europe early next year, according to Jackson.
Developers who want to link to their own websites to give their users a discounted rate should be careful, because of the right that is reserved by Google. “Google is not required to allow developers to include links that take a User outside an app distributed through Google Play to make a purchase,” the settlement agreement reads. We are still waiting to find out whether Apple will allow links and/or buttons to alternative payment systems, based on the ruling in Epic v. Apple. But the Google / state AGs settlement suggests that regardless, Google will not be required to allow links.
More importantly, several of the most significant sounding changes here are tied to Google’s User Choice Billing program — which is mostly a fake choice, the Epic v. Google trial proved.
During the trial, Google argued that third-party apps can be installed on any phone or device, and it also argued that many of its agreements with developers and carriers don’t require them to exclusively put Google Play on their phones.
Does that sound like a lot? It adds up to a slightly different landscape for the app store that we have experienced over the past decade and change. But not only does every one of these concessions have an expiration date, many of them are arguably not real concessions.
The biggest change: Google will need to let developers steer consumers away from the Google Play Store for several years, if this settlement is approved.
