Google has agreed to pay consumers $630 million and implement various concessions to settle allegations of anti-competitive practices in its Android app store, a parallel issue to a recent trial. The deal, reached with state attorneys general in September, was disclosed in documents filed in San Francisco federal court, following a jury’s rebuke of Google’s anticompetitive tactics in its Play Store for Android apps.
The settlement involves $630 million to compensate U.S. consumers affected by a payment processing system that allegedly inflated prices for digital transactions within apps downloaded from the Android-based Play Store. Eligible consumers will receive at least $2, with additional payments based on their spending in the Play Store from August 16, 2016, to September 30, 2023.
An additional $70 million covers penalties and costs imposed on Google by the states. The total settlement is over 25 times the $23 million consolidated settlement earlier this year for class action privacy lawsuits dating back a decade.
While the sum Google is paying is substantial, it represents a fraction of the $10.5 billion in damages the attorneys general planned to seek if the case had gone to trial. Similar to Apple, Google collects commissions of 15% to 30% on in-app purchases, a practice challenged by state attorneys general as driving up consumer prices.
As part of the settlement, Google will make changes for the next five years to facilitate the installation of Android apps from outlets other than the Play Store. The company will also reduce security warnings and allow more flexibility for app makers to offer alternative payment choices to consumers.
The settlement is seen as a message to Big Tech by state attorneys general, signaling a commitment to ensuring fair access to the digital marketplace. Google framed the deal positively, emphasizing Android’s choice and flexibility, security protections, and its ability to compete.
While hailed as a win by state attorneys general, Epic Games, which brought an antitrust lawsuit against Google’s app store practices, rejected the settlement. Last week, a jury found in favor of Epic, declaring that Google had erected anticompetitive barriers around the Play Store. Google intends to appeal the verdict.
The settlement’s approval is pending from U.S. District Judge James Donato, who presided over the Epic Games trial. Another significant antitrust case against Google, targeting its dominant search engine, is scheduled for closing arguments in May.
