Google Faces Antitrust Lawsuit from 36 States Over Play Store Fees
On Wednesday, a coalition of state attorneys from 36 states and Washington has launched a new antitrust lawsuit against Google. In the lawsuit, they have accused the search engine giant of abuses its power over the sale and distribution of apps in the mobile app store, as per Bloomberg’s reports.
The lawsuit was launched in California federal court. It challenges Google’s anticompetitive tactics to thwart developers to go through the Play app and pay an extravagant commission fee of up to 30 percent on sales.
Recently, Google expanded its fees to cover more digital goods, particularly aiming at prominent apps that had previously sidestep the tax, purchased on the Play Store.
You can view the full complaint here with the list of defendants as Google, Alphabet, and subsidiaries in Ireland and Asia.
“It’s strange that a group of state attorneys general chose to file a lawsuit attacking a system that provides more openness and choice than others,” Google wrote in a blog post responding to the lawsuit. “This complaint mimics a similarly meritless lawsuit filed by the large app developer Epic Games, which has benefitted from Android’s openness by distributing its Fortnite app outside of Google Play.”
A few months ago, Epic Games, a Fortnite developer, sued Google play store and App store on similar grounds. They claimed that both companies have raised prices for consumers online.
The lawsuit on Google comes amid federal pressure from its other three federal antitrust lawsuits, including an ongoing Justice Department case that accuses them of monopoly practices in search advertising.
Today, both Google and Apple are a duopoly dominating the app economy in the West. They have come under intense scrutiny from regulators due to several complaints from developers of their high fees and complex rules.
Analytics firm App Annie says that mobile app stores saw a 20% jump from the previous year accounting for a total of $143 billion was spent in 2020.
Since Android does not require Google Play as the sole source of software on the phone, it has been seen as less of an antitrust threat than Apple.
However, the growing scrutiny has called many aspects of the App Store’s fee structure into question.
In recent hearings, regulators have questioned Google and Apple on making their app stores as default on mobile devices.
Recently, Google and Apple, giving in to the mounting public pressure, jointly lowered their store fee to 15 percent for smaller developers.