Google to pay $700M in antitrust settlement over Play Store dispute

Google has agreed to pay $700 million and to allow for greater competition in its Play Store to settle allegations that it had been stifling competition against its Android app store.

The company will pay $630 million into a settlement fund for consumers and $70 million into a fund that will be used by states, Reuters reported Monday night via the terms of an antitrust settlement with U.S. states and consumers.  The settlement still requires a judge’s final approval.

The settlement said eligible consumers will receive at least $2 and may receive additional payments based on their spending in the app store between Aug. 16, 2016, and Sept. 30, 2023. All 50 states, Washington, D.C., Puerto Rico and the Virgin Islands joined the settlement.

Google allegedly overcharged consumers through unlawful restrictions on the distribution of apps on Android devices and unnecessary fees for in-app transactions. The company did not deny the allegations.

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The settlement was announced by some states in September, but the terms were kept confidential ahead of Google’s related trial with video game maker Epic Games. A California federal jury sided last week with Epic Games, which argued that parts of Google’s app business were anticompetitive.

Google’s Vice President for Government Affairs and Public Policy Wilson White said in a statement that the settlement “builds on Android’s choice and flexibility, maintains strong security protections, and retains Google’s ability to compete with other (operating system) makers, and invest in the Android ecosystem for users and developers.”

The company said it was expanding the ability of app and game developers to provide consumers with an alternative billing option for in-app purchases next to the app store’s billing system. As part of the settlement, Google said it would simplify the ability to download apps directly from developers.

In their court filing, lawyers for the states said the settlement’s terms “will offer significant, meaningful, long-lasting relief for consumers throughout the country” and that “no other U.S. antitrust enforcer has yet been able to secure remedies of this magnitude from Google” or another major digital platform.

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Epic Games requested an injunction, but not monetary damages in its case. The company is expected to make its own proposal to the judge hearing the cases next year about potential changes to Google’s app store. Epic Games’ public policy head Corie Wright said in a statement that the states’ settlement “did not address the core of Google’s unlawful and anticompetitive behavior.”

Wright said Epic Games will work at the next phase of its trial “to truly open up the Android ecosystem.”

Google is also facing other lawsuits challenging its search and digital advertising practices. The company has denied any wrongdoing in those cases.

Reuters contributed to this report.