Google agrees to pay $700m after accusations of overcharging

Alphabet’s Google has agreed to pay $700m and to allow for greater competition in its Play app store, according to the terms of an antitrust settlement with US states and consumers disclosed on Monday in a San Francisco federal court.

Google will pay $630m into a settlement fund for consumers and $70m into a fund that will be used by states, it said in a statement.

Google was accused of overcharging consumers through unlawful restrictions on the distribution of apps on Android devices and unnecessary fees for in-app transactions. It did not admit wrongdoing. The settlement still requires a judge’s final approval.

Lead plaintiff Utah and other states announced the settlement in September, but the terms were kept confidential ahead of Google’s related trial with Fortnite maker Epic Games. A Californian federal jury last week agreed with Epic that parts of Google’s app business were anticompetitive.

Wilson White, Google vice-president for government affairs and public policy, said in a statement the settlement “builds on Android’s choice and flexibility, maintains strong security protections, and retains Google’s ability to compete with other [operating system] makers and invest in the Android ecosystem for users and developers”.

The company said it is expanding the ability of app and game developers to provide consumers with an alternative billing option for in-app purchases next to Play’s billing system. Google said it piloted “choice billing” in the US for more than a year.

As part of the settlement, Google said it will simplify users’ ability to download apps directly from developers.

In 2024 Epic will ask the judge hearing both cases, US district judge James Donato, to issue an order that could require Google to make changes to its Play Store.

Google faces other lawsuits challenging its search and digital advertising practices. It has denied any wrongdoing in those cases.

Reuters