Google loses antitrust dispute with Epic in Google Play Store case, court decision affirms
In a significant turn of events, a three-judge panel in the Ninth Circuit US Court of Appeals has affirmed an antitrust verdict against Google, ruling that the tech giant had violated federal and state antitrust laws in the markets for Android app distribution and Android in-app billing services.
The decision comes as a blow to Google's hopes of using the Apple case in its legal tussle with Epic Games. The appeals panel disagreed with Google's argument, stating that the commercial realities between Apple and Google are different.
Google's top priority remains protecting users, developers, and partners, and maintaining a secure platform. However, the panel's ruling will require Google to make significant changes to the Play Store.
Key mandated changes include:
- Google must make the Play Store’s entire library of over 2 million Android apps accessible to rival app stores, allowing these competitors to offer the same apps to consumers.
- Google is required to support and facilitate the distribution of these alternative app stores within the Android ecosystem, effectively "tearing down digital walls" that previously blocked competition.
- The injunction mandates a three-year period (2024–2027) during which Google must allow rival app stores and alternative billing systems to operate inside the Play Store environment.
- Google must permit developers to use payment processors other than Google's own billing system for in-app purchases, loosening Google’s tight control over app revenues generated through billing.
- A technical compliance committee, jointly selected by Google and Epic Games, will oversee the implementation to balance increased competition with security considerations, aiming to minimize risks such as scams or hacking.
These changes could substantially reduce Google's app revenue, with market analysts estimating a decline of $1 to $1.5 billion annually. Google currently contests aspects of this ruling and seeks further delays, citing concerns over privacy and security risks.
The original injunction, only in the US, was set to run for three years and gave Google eight months to implement the necessary changes. If the emergency stay is not granted, Google will have to open up Android, potentially allowing third parties to set up shop on the platform.
Meanwhile, Epic Games, which lost an antitrust battle with Apple in 2021, has not announced any settlement or changes in its antitrust side quest. Tim Sweeney, boss of Epic Games, posted on social media that it was a total victory in the Epic v Google appeal, but there is no information about Fortnite's stateside iOS comeback or Apple slamming the door on the game's return.
Sweeney also announced that the Epic Games Store for Android will be coming to the Google Play Store due to the verdict. Google admits that Android's open philosophy offers more choices than iOS, but it limits Google's ability to protect users from malware and security threats.
In a statement, Google Global Head of Regulatory Affairs stated that the decision will significantly harm user safety, limit choice, and undermine innovation in the Android ecosystem. This court decision forces Google to open up the Android app ecosystem to competition, ending some of its exclusivity and control over app distribution and payment processing in the Play Store.
- The decision by the Ninth Circuit US Court of Appeals could potentially lead to the integration of Epic Games' store within the Google Play Store, expanding the choices for Android users.
- As a result of the ruling, Google may face challenges in maintaining the security of the Android platform while also adhering to the mandated changes, such as allowing rival app stores and alternative billing systems.
- The court's verdict has far-reaching implications for the technology industry, particularly in the realm of finance, as it could lead to a shift in revenues generated from app sales and in-app purchases.
