Report from Bloomberg
In Brief – Google and Epic Games have agreed to settle their long-running antitrust battle over the rules and fees of the Android Play Store, with Google agreeing to implement changes both sides say will lower fees and expand choices for developers and consumers. The two sides are asking District Judge James Donato to approve the settlement to resolve Epic’s 2020 antitrust lawsuit that accused Google of monopolizing Android app downloads and in-app payments. A jury fully sided with Epic in 2023 and Judge Donato imposed a sweeping nationwide injunction ordering major changes to the Play Store that Google appealed. Google and Epic have now agreed on a modified set of rules that allow users to more easily download and install third-party app stores that meet security and safety standards, while developers will be allowed to direct users to alternative payment methods both within apps and via external web links. Google said it would implement a capped service fee of either 9% or 20% on transactions in Play-distributed apps that use alternative payment options. Of note, where Donato’s injunction only applied in the US and for three years, the settlement applies for six years with the fee levels being global. Epic Games CEO Tim Sweeney, who has been personally engaged in the company’s legal and regulatory campaign to change the Apple and Google mobile ecosystems and lower both company’s fees, called the agreement “awesome”.
Context – Epic’s 2020 antitrust lawsuits against Apple and Google opened a global lobbying and litigation campaign to drive down their fees. Apple, despite earning more money from developers and running a closed system largely prevailed, while Google, with a more open ecosystem, lost. However, Apple did lose on a single complaint involving California’s Unfair Competition Law and eventually was hit with an injunction at least as restrictive as the one Google faced after losing across the board. Apple is still appealing. Globally, both companies face similar demands in Europe, Japan, South Korea and India, with each new result feeding more.