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36 states sue Google over how it manages its Play store, alleging damage to both consumers and app developers

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A group of state attorneys general filed an antitrust lawsuit targeting Googles app store Wednesday, adding to the tech giants mounting regulatory woes, as government officials at both the federal and state level bring challenges to its business practices.

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Thirty-six states, including Utah, New York, North Carolina and Tennessee, and the District of Columbia brought the suit.

The suit argues that Google maintains a monopoly in the market for distributing apps for the Android operating system, which it owns and develops and is used by most of the world's smartphones. The suit claims that Google favors its Play store over other app stores available on Android devices and argues that developers have "no reasonable choice" but to distribute their apps through the store.

"Google has taken steps to close the ecosystem from competition and insert itself as the middleman between app developers and consumers," the state attorneys general allege.

The group of states says that this conduct has harmed both consumers and app developers, especially when it comes to in-app purchases where the company takes a commission.

App developers have publicly criticized Google's rules for participating in its Play Store, which figures in a lawsuit brought against the company by Fortnite maker Epic Games. For years, the Internet giant charged a 30% commission for the sale of apps and in-app purchases on the Play Store. Facing mounting pressure, it dropped that to 15% at the beginning of July, but only on the first $1 million generated by an app developer.

The app stores controlled by Apple and Google have been a major target of antitrust authorities around the world. Competitors and critics say the stores allow the two giants to play gatekeeper to the world's mobile phones, giving them immense power over the Internet and the digital economy.

Unlike Apple, Google does allow other companies to sell apps on the Android operating system. But in most countries, the official Play store is the main place to get apps, and Google has required device makers to preload the store on phones, which competitors say gives it an unfair advantage.

Google did not immediately respond to a request for comment, but the company has argued that its Play Store helps developers and consumers. Wilson White, Google's senior director of government affairs and public policy, testified before a Senate Judiciary antitrust subcommittee in April that developers have alternatives beyond the Play Store and that the fees it charges are in line with others in the industry.

 

Google is already the target of a historic federal antitrust complaint, which was brought in October and focuses on the special agreements and other business practices the company used to secure its dominance in online search. In December, more than 40 state attorneys general sued the company, arguing that it gives its own products and services preferential treatment in search results. That same month, 10 Republican state attorneys general filed an antitrust lawsuit targeting the company's online ad business.

Published : July 08, 2021

By : The Washington Post · Cat Zakrzewski, Gerrit De Vynck