USALife.info / NEWS / 2023 / 12 / 14 / GOOGLE'S PLAY STORE FEES IN JEOPARDY AFTER STUNNING ANTITRUST LOSS TO EPIC GAMES
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Google's Play Store fees in jeopardy after stunning antitrust loss to Epic Games

18:48 14.12.2023

In a landmark antitrust case, Google suffered a devastating loss against Epic Games, the maker of popular game "Fortnite." The unanimous verdict by the federal jury in San Francisco found that Google had maintained an illegal monopoly through its Android app store, known as the Google Play store. This verdict, according to Matt Stoller, the director of research at the antitrust watchdog group American Economic Liberties Project, could potentially lead to a wave of restructuring for Google and other Big Tech firms.

Stoller believes that Google will start settling and agreeing to split off pieces of its business over the next five years, as they realize they are likely to lose in similar cases. He also emphasized the significance of this verdict, stating that it is the first time a powerful Big Tech firm has lost a major antitrust case. Stoller predicts that this outcome will influence other ongoing antitrust battles faced by Google and other large companies.

The implications of the jury's decision on Google's business model could be significant. For years, Google has charged large companies fees of up to 30% on in-app purchases made through its Play store. The jury's findings could lead to remedies such as barring Google from making payments to app developers to discourage them from launching rival app stores or discontinuing its billing requirements. This could open the door for competition and force Google to negotiate more favorable terms or risk losing business to emerging rivals.

The verdict also has implications for Google's ongoing legal battles. The company is awaiting a judge's ruling on the landmark Justice Department case targeting its online search empire, as well as separate probes into its digital advertising business and Google Maps. Stoller believes that the precedent set by this case will make it harder for Google to win these cases.

Experts believe that the Google v. Epic verdict could upend Google's profitable Play store business model. The company has already earned billions in annual profits through its app store, but the jury's findings might force Google to adjust its fees and requirements. The judge in the case, James Donato, will determine the specific business practices that Google must scrap.

Epic Games sought "injunctive relief" rather than monetary damages in this case, indicating that they wanted Google to change its business practices rather than receive compensation. Epic CEO Tim Sweeney believes that this verdict marks the beginning of the end for Google's 30% revenue cut and will put pressure on Apple, which recently won a favorable split verdict in its own court battle with Epic.

During the trial, Epic's legal team focused on Google's "Project Hug," an internal scheme that involved making payments to app developers to keep them from launching rival app stores. The jury saw emails showing concerns among Google employees about the 30% commission and the use of incentives for specific developers. Analysts suggest that if Google is forced to lower its commission or allow developers to use their own payment systems, media companies could earn higher margins on their products.

While the Apple v. Epic case is still under appeal, experts believe that the Google verdict will have a negligible impact on those proceedings. The cases have different facts and were decided by different means - a jury in the Google case and a federal judge in the Apple case. However, the Google verdict could undermine Apple's appeal of one count in its case, which ruled that Apple violated the law by blocking app developers from steering customers away from its payment system.

This antitrust loss for Google could have wider implications for other tech firms facing similar scrutiny. Google is also facing a massive Justice Department antitrust suit targeting its online search business, and the outcome of this case could send a message to other judges and juries that Google is not a perfect company. Google plans to challenge the verdict, but the implications of this loss are significant.

/ Thursday, December 14, 2023, 6:48 PM /

themes:  San Francisco  California



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