Google has lost its antitrust lawsuit against Epic Games. Google will now have to loosen its policies for other app stores to live on its Android phones.
Epic Games had previously won a case against Apple’s own iPhone App Store. The case started when Epic did not want to pay the 30% “tax” on in-app purchases that form the core of its revenue. CNBC reports:
A federal court jury has decided that Google’s Android app store has been protected by anticompetitive barriers that have damaged smartphone consumers and software developers, dealing a blow to a major pillar of a technology empire.
The unanimous verdict reached Monday came after just three hours of deliberation following a four-week trial revolving around a lucrative payment system within Google’s Play Store. The store is the main place where hundreds of millions of people around the world download and install apps that work on smartphones powered by Google’s Android software.
Android already allowed the download of apps through a third party store. However, users could not have a different App Store on stock Android software. Companies like Samsung could avoid the problem by creating their own version of Android. The Washington Post continues:
For years, regulators, competitors and antitrust advocates have targeted Apple and Google’s app stores, arguing the fees they charge amount to a tax for app developers to reach their customers. Though mobile phones act as fully-fledged handheld computers, app downloads overwhelmingly go through Apple and Google’s stores. This bottleneck allows the companies to make billions of dollars by charging fees as high as 30 percent on sales and transactions. If a company like Epic sells something through a regular website, it only pays single-digit fees to payment processors. But if it sells the same product through a mobile app, it must pay Apple or Google a fee.
So far this year, Apple has made $23.7 billion in revenue from its app store, while Google has made $13.5 billion, according to mobile data research firm Data.ai.
This is part of a broader trend of court orders and legislation forcing more openness on mobile devices. Phone software developers like Apple and Google will have to find new ways to make their stores competitive if new players come on the market.
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