Court rules in favour of Epic Games, but Google will appeal
7 Oct 2024
Epic Games, the developer behind the popular video game Fortnite, has won a major antitrust case against Google. The ruling, which was handed down by the United States District Court for the Northern District of California, found that Google did indeed engage in anticompetitive practices in its operation of the Google Play Store. But Google is not taking this lying down and has moved to appeal the decision.
Epic Games originally filed the case in August 2020, alleging that Google had used its monopoly power to stifle competition and harm consumers.
Specifically, Epic Games claimed that Google had made it difficult for developers to distribute their apps outside of the Google Play Store and that Google had charged excessive fees for in-app purchases.
The allegations were mirrored in a similar case against Apple which Epic launched on the same day.
In favour of Epic
The court agreed with Epic Games, finding that Google had engaged in a number of anticompetitive practices.
These practices included:
- Sharing Play Store revenues with current or potential Android app store rivals.
- Imposing contractual terms that condition benefits on promises intended to guarantee Play Store exclusivity.
- Requiring developers to use Google Play Billing in apps distributed on the Google Play Store.
- Prohibiting developers from communicating with users about the availability of a payment method other than Google Play Billing.
The court ordered Google to take a number of steps to restore competition in the market for Android app distribution and in-app billing.
These steps include allowing third-party app stores to access the Google Play Store's catalogue of apps and allowing users to complete the download of apps through the Google Play Store on the same terms as any other download that is made directly through the Google Play Store.
The ruling is a major victory for Epic Games and for other app developers who have long complained about Google's anticompetitive practices.
In a statement, Epic Games CEO Tim Sweeney praised the ruling, saying that it would "help to level the playing field for all app developers."
Sweeney also said that the ruling would "ensure that consumers have more choice and better prices."
Google fires back
Google, however, strongly disagrees with the court's decision and has announced its intention to appeal.
Google's vice president of regulatory affairs, Lee-Anne Mulholland, argued in a company blog post that the verdict "missed the obvious": that Apple and Android clearly compete.
Mulholland contends that the court's decision rests on a "flawed finding that Android is a market in itself," ignoring the direct competition between Android and iOS.
She maintains that consumers choose between these operating systems based on factors like price, quality, and security, highlighting the competitive landscape of the smartphone market.
It’s actually Apple’s fault
Google argues that the ruling disregards the reality faced by app developers who must prioritise investing in both iOS and Android platforms.
Mulholland points out that developers have limited resources and need to strategically allocate their time and money across different platforms.
She is adamant that Android is an open platform, offering developers various app distribution options beyond Google Play, such as pre-loaded app stores and direct downloads from websites.
This openness, Google argues, is a key distinction from Apple's iOS, which has a more closed ecosystem.
Major risk
Mulholland concludes by stating that the court's decision and Epic's requested changes "put that [openness] at risk and undercut Android's ability to compete with Apple's iOS."
Google intends to ask the courts to pause the implementation of the remedies while the appeal is pending to "maintain a consistent and safe experience for users and developers."
The outcome of the appeal will have major implications for the future of the Android app market and the relationship between app developers and platform holders.
Despite the looming appeal, the initial ruling is a clear victory for Epic Games.
The company got everything it wanted out of the case, including an injunction that prohibits Google from engaging in anticompetitive practices and an order that requires Google to take steps to restore competition in the Android app market.
