Judge orders Google to open up app store to competition.
Judge's order
A U.S. judge issued a ruling on Monday requiring Alphabet's Google to revamp its mobile application business, thereby providing Android users with increased options for downloading applications and processing transactions within those applications. This decision follows a jury verdict from the previous year in favor of Epic Games, the developer of "Fortnite." The injunction, delivered by U.S. District Judge James Donato in San Francisco, specified the modifications that Google must implement to enhance competition within its profitable app store, Play, which includes allowing Android applications to be accessible from competing sources.
Appeal
Donato's ruling stipulates that for a duration of three years, Google is prohibited from restricting the use of in-app payment systems and is required to permit users to download alternative third-party Android application platforms or stores. The ruling also prevents Google from providing financial incentives to device manufacturers for the preinstallation of its app store and from distributing revenue accrued from the Play Store to other application distributors. In response, Google has announced its intention to appeal the decision that resulted in the injunction to the 9th U.S. Circuit Court of Appeals in San Francisco, and it will seek a suspension of Donato's order while the appeal is underway.
"Ultimately, while these changes presumably satisfy Epic, they will cause a range of unintended consequences that will harm American consumers, developers and device makers," Google said.
Epic Chief Executive Tim Sweeney announced on the social media platform X on Monday that Donato's order represents "significant news." He indicated that both the Epic Games Store and other app stores are set to launch on Google Play in 2025. Sweeney emphasized that app developers, store creators, and others have a three-year window to establish a robust and competitive Android ecosystem with sufficient scale to prevent Google from hindering its progress.
Epic's lawsuit accused Google of monopolizing app access
Epic Games initiated a lawsuit in 2020, alleging that Google had established a monopoly over consumer access to applications on Android devices and the payment processes for in-app purchases. The company, headquartered in Cary, North Carolina, successfully convinced a jury in December 2023 that Google had unlawfully suppressed competition through its control over app distribution and payment systems, which led to Judge Donato's injunction.
Google had requested that Donato dismiss Epic's suggested reforms, contending that they were expensive, excessively restrictive, and could jeopardize consumer privacy and security. However, the judge largely dismissed these concerns during a hearing in August. He remarked to Google's legal team,
"You’re going to end up paying something to make the world right after having been found to be a monopolist."
In a separate antitrust matter in Washington, U.S. District Judge Amit Mehta ruled on August 5 in favor of the U.S. Justice Department, stating that Google had unlawfully monopolized web search, investing billions to secure its position as the default search engine on the internet. Additionally, Google commenced a trial in September in a Virginia federal court concerning a Justice Department lawsuit related to its dominance in the advertising technology market. Google has refuted the allegations in all three cases.
