Google to Pay $700 Million to Settle Play Store Antitrust Lawsuit

Google has agreed to pay $700 million to settle a Play Store antitrust lawsuit that was filed by US states and consumers back in 2021. As part of the settlement, Google also agreed to make some changes to its Play Store and simplify the process of sideloading apps on Android.

The class action lawsuit that was filed two years ago accused the Google Play Store of violating U.S. federal antitrust rules by overcharging customers, who may have been able to save money if Google didn’t have a monopoly on app distribution on Android. Google said yesterday that it was “disappointed that the verdict did not recognize the choice and competition that our platforms enable,” but the company still agreed to settle the case in September, but the details were only made public yesterday.

Google has agreed to pay $630 million into a settlement fund to be distributed for the benefit of consumers, as well as $70 million into a fund that will be used by the states. The settlement also says that “each eligible consumer will receive at least $2 and will receive additional payments in proportion to their Google Play spending during the period between August 16, 2016 and September 30, 2023” (via CNN).

Google also agreed to make a couple of important changes that will impact developers and consumers: First of all, developers will be able to use alternative billing options in their apps in the US, and Google has been piloting this “user choice billing” feature with select developers for over a year. However, a Google spokesperson confirmed to The Verge that Google will still take a 26% cut (instead of the regular 30% fee) on in-app payments that go through developers’ own payment systems.

Moreover, Google will simplify the process of sideloading apps on Android. The company also plans to update the language it uses to warn users about the potential risks of downloading apps from the web for the first time.

The news of this settlement comes just a couple of days after Epic Games won its separate antitrust battle against Google. “While we are challenging that verdict and our case with Epic is far from over, we remain committed to continually improving Android and Google Play,” Google said yesterday.

In a reaction to the settlement, Epic Games CEO Tim Sweeney highlighted that Google expanding its user choice billing program to all developers in the US won’t have much of an impact. “The settlement endorses Google’s 30% monopoly rent imposition, by replacing the anticompetitive Google Play Billing tie with a new anticompetitive Google-imposed “user choice billing” tie which adds a useless 26% Google Tax for payments they don’t process,” Sweeney posted on X yesterday.