A federal court jury has decided that Google’s Android app store is protected by anticompetitive barriers that have harmed smartphone consumers and software developers, dealing a blow to a key pillar of a technology empire.
The unanimous verdict reached on Monday came after just three hours of deliberation following a four-week trial around a lucrative payment system on Google’s Play Store. The store is the main place where hundreds of millions of people around the world download and install apps that work on smartphones powered by Google’s Android software.
Epic Games, the maker of the popular video game Fortnite, filed a lawsuit against Google three years ago, claiming the Internet search giant abused its power to protect its Play Store from competition to protect a gold mine worth billions earns dollars per year. Much like Apple does for its iPhone app store, Google collects a commission ranging from 15 percent to 30 percent on digital transactions completed within apps.
Apple prevailed in a similar case brought by Epic against the iPhone App Store. But that 2021 lawsuit was decided by a federal judge in a ruling that is under appeal to the U.S. Supreme Court.
The nine-member jury in the Play Store case apparently saw things through a different lens, even though Google technically allows Android apps to be downloaded from various stores — an option that Apple bans on the iPhone.
Just before the Play Store trial began, Google tried to prevent a jury from determining the outcome, but its request was denied by U.S. District Judge James Donato. It is now up to Donato to determine what steps Google will have to take to end its illegal behavior on the Play Store. The judge has indicated that he will hold hearings on the matter in the second week of January.
Epic CEO Tim Sweeney broke into a wide grin after reading the verdict, slapping his lawyers on the back and also shaking hands with a Google lawyer, whom he thanked for his professional attitude during the proceedings.
“Victory over Google!” Sweeney wrote in a post on X, the platform formerly known as Twitter. In a company post, Epic called the verdict “a victory for all app developers and consumers around the world.”
‘Apple is not the ‘Get out of jail free card’
Google plans to appeal the verdict, according to a statement from Wilson White, the company’s vice president of government affairs and public policy.
“Android and Google Play offer more choice and openness than any other major mobile platform,” said White.
Depending on how the judge implements the jury’s verdict, Google could lose billions of dollars in annual profits from Play Store commissions. The company’s main source of revenue – digital advertising tied mainly to its search engine, Gmail and other services – will not be directly affected by the outcome of the trial.
The jury reached its decision after listening to two hours of closing arguments from attorneys for opposing sides in the case.
Epic lawyer Gary Bornstein has portrayed Google as a ruthless bully using a ‘bribe and block’ strategy to discourage competition against its Play Store for Android apps. Google lawyer Jonathan Kravis attacked Epic as a self-serving game maker trying to use the courts to save itself money while undermining an ecosystem that has spawned billions of Android smartphones to compete with Apple and its iPhone.
Many of the lawyers’ dueling arguments focused on the testimony of a litany of witnesses who came to court during the trial.
Key witnesses included Google CEO Sundar Pichai, who at times resembled a professor explaining complex topics while standing behind a lectern due to a health problem, and Sweeney, who painted himself as a video game enthusiast on a mission to save a greedy take down tech titan. .
In his closing argument for Epic, Bornstein blasted Google for exploiting its power over Android software in a way that “has led to higher prices for developers and consumers, but also less innovation and quality.”
Google has staunchly defended the commissions as a way to recoup the more than $40 billion (€37 billion) it has poured into building the Android software it has given away to manufacturers since 2007 to compete with the iPhone.
“Android phones can’t compete with the iPhone without a great app store,” Kravis claimed in his closing argument. “Competition between app stores is linked to competition between phones.”
But Bornstein ridiculed the idea that Google and Android would compete with Apple and its incompatible iPhone software system. “Apple is not the get-out-of-jail-free card that Google wants,” Bornstein told the jury.
Google also pointed to competing Android app stores, like the one Samsung installs on its popular smartphones, as evidence of a free market. Combined with the rival app stores that come pre-installed on other companies’ devices, more than 60 percent of Android phones offer alternative outlets for Android apps.
However, Epic presented evidence that supported the idea that Google welcomes competition as a pretext, citing the hundreds of billions of dollars it has doled out to companies, such as game maker Activision Blizzard, to discourage them from opening competing app stores. In addition to these payments, Bornstein also urged the jury to take into account Google’s “scare screens” that appear and warn consumers of potential security risks when they try to download Android apps from some of the Play Store alternatives.
Google’s empire could be further undermined by another major antitrust lawsuit in Washington, which a federal judge will decide after hearing final arguments in May. That trial spotlighted Google’s cozy relationship with Apple in online search, the technology that made Google a household name a few years after two former Stanford University students bought the company from a Silicon Valley garage in 1998. set up.