A federal jury in San Francisco (California, USA) has ruled that Google violated antitrust laws with its Play Store platform, dedicated to downloading mobile applications, harming the interests of video game developers such as Epic Games, as well as its users. The verdict blames the multinational for carrying out anti-competitive practices due to the high commissions of its app store, leaving low profit margins for Epic Games (creator of the Fortnite game) and other independent developers.
The ruling could redefine the rights that would protect software companies in the future in the Play Store, a virtual store from which millions of Android users install applications on their smartphones. It is expected that it will be early next year when the judge for the Northern District of California, James Donato, decides the formula to apply to reverse the situation, but it is not ruled out that the door will be opened for other application stores to access the system managed by Google.
Google currently pockets up to 30% of purchases made through apps previously downloaded from the Play Store, generating a stream of billions of dollars annually in revenue. Gary Bornstein, a lawyer for Epic Games, has described Google during the trial as a corporation that encourages “bribery” and blocks competition in the Play Store.
For its part, Google’s defense tried to refute the idea that the company occupies an anti-competitive position by claiming that they were facing the App Store system, which is only available on Apple terminals. Epic Games also sued Apple for the same reason, but in that case the court did not agree with it by not considering that the App Store can be considered a monopoly. Other companies such as the developer of Tinder have sued Google for the same reason.
Recover the investment
Google has in turn defended that 30% commissions are a necessity to recover its $40 billion investment to create the Play Store, formerly called Android Market, which it has been developing since 2008. The company’s CEO, Sundar Pichai, and his counterpart at Epic Games, Tim Sweeney, met without success at the end of last week to try to reach an agreement that favored both parties; a strategy already used by the technology giant with other video game companies such as Activision Blizzard.
Although there are pre-installed application stores on Android devices manufactured by other brands, the Play Store clearly dominates that market and this Monday’s decision is a boost to the hypotheses that Google had engaged in legal fraud that even undermined innovative efforts by other companies.
The technology giant faces another antitrust trial in Washington following accusations from the US Department of Justice that Google allegedly abused its hegemony as an internet search engine by paying billions of dollars to achieve this privileged position.