Google must open its Android app store to competition from smaller rivals such as “Fortnite” maker Epic Games, a federal judge said Monday in a landmark ruling that could topple the company’s dominance of the app market.
The sweeping remedies outlined by US District Judge James Donato in San Francisco federal court came months after North Carolina-based Epic Games won a stunning ruling against Google. Last December, a jury found that Google operated illegal monopolies through the Play Store and its closely related Android in-app billing system.
“You’re going to end up paying something to make the world right after you’re found to be a monopolist,” Donato told Google’s lawyers in court.
For the next three years, Google will be prohibited from preventing app developers from using its in-app payment systems or directing users to download apps from sources outside of its profitable Play Store for Android apps, according to Donato’s. I order.
Additionally, Google will be blocked from paying developers of specific apps to exclusively use its Play Store for distribution, and will be barred from sharing revenue generated by the Play Store with other app store operators.
Shares of Google parent Alphabet were down more than 2% in Monday trading.
Google said it will ask the court to halt the judge’s changes pending the outcome of its ongoing appeal of the jury’s decision.
“Ultimately, while these changes appear to please Epic, they will cause a number of unintended consequences that will harm US consumers, developers and device manufacturers,” Google said in a blog post.
Epic Games did not immediately return a request for comment on the judge’s decision.
Google will also be required to provide rival developers with access to its back catalog of apps. It cannot offer offers to smartphone manufacturers or operators to pre-install the Play Store.
The preliminary injunction is scheduled to take effect on November 1 and continue until the same date in 2027.
Donato said Google will be allowed to take “reasonable measures” to ensure security. Google had argued that any bid to force open the app store would put user privacy and devices at risk.
The judge ordered the creation of a three-person committee to oversee compliance with his order, with Epic and Google each appointing one member and those two selecting a third member.
Epic Games and other critics have claimed for years that Google has a stranglehold on the app market, where it has traditionally taken commissions of up to 30% on digital transactions made within the Play Store.
During the trial, Epic’s legal team focused on Google’s practice of making payments and reaching agreements with developers to stifle competition against the Play Store. Lawyers referred to the practice – known domestically as “Project Hug” – as a “bribe and lock-up” scheme.
In one such case, Google offered $360 million in incentives to “Call of Duty” maker Activision Blizzard to launch its games on the Play Store.
The judge’s ruling is just the latest sign of a growing legal and regulatory crackdown against Google.
In August, US District Judge Amit Mehta ruled that Google has an illegal monopoly over the Internet search market. He is expected to decide on the appropriate penalties by next summer.
Separately, Google is facing the Justice Department in a separate federal antitrust case targeting its alleged monopoly over digital ad technology.
In either case, the feds are likely to pursue a forced breakup of the Google empire.
By postal wires
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