Updated December 19th, 2023 at 15:25 IST

Google reaches $700 million settlement in antitrust case with US states, consumers

The antitrust allegations against Google centred around accusations of overcharging consumers due to unlawful restrictions on app distribution on Android.

Reported by: Business Desk
Alphabet (Google): $1.716 trillion | Image:Unsplash
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Google, a subsidiary of Alphabet, has reached a $700 million settlement in an antitrust case with US states and consumers, as disclosed on Monday in a federal court in San Francisco. The settlement, which is still pending final approval from a judge, involves a payment of $630 million into a fund for consumers and an additional $70 million into a fund for states.

The antitrust allegations against Google centred around accusations of overcharging consumers due to unlawful restrictions on app distribution on Android devices and imposing unnecessary fees for in-app transactions. Notably Google did not admit any wrongdoing in this settlement.

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Under the terms of the agreement, eligible consumers are set to receive a minimum of $2, with the possibility of additional payments based on their spending on Google Play between August 16, 2016, and September 30, 2023. All 50 US states, along with the District of Columbia, Puerto Rico, and the Virgin Islands, have joined this comprehensive settlement.

The settlement also includes provisions aimed at fostering greater competition in Google's Play app store. Google has committed to allowing app and game developers to offer consumers an alternative billing option for in-app purchases alongside Play's existing billing system. This move, known as "choice billing," has been piloted in the US for over a year. Additionally, Google will simplify the process for users to download apps directly from developers.

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Wilson White, Google's Vice President for Government Affairs and Public Policy, emphasized that the settlement reinforces Android's choice and flexibility, maintains strong security protections, and preserves Google's ability to compete with other operating system makers while continuing to invest in the Android ecosystem for users and developers.

This settlement comes on the heels of a California federal jury ruling in favour of "Fortnite" maker Epic Games, which argued that certain aspects of Google's app business were anticompetitive. Epic, while not seeking monetary damages, is expected to propose changes to Google's Play store in the near future.

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Google is still contending with other legal challenges, particularly related to its search and digital advertising practices, and has consistently denied any wrongdoing in those cases.

(With Reuters inputs)
 

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Published December 19th, 2023 at 11:09 IST