UPDATED 15:17 EDT / JULY 01 2022

APPS

Google settles developer lawsuit over Android app policies

Google LLC has settled a class-action lawsuit filed over its business practices in the mobile market, the search giant announced on Thursday.

Google requires most Android apps listed on the Google Play marketplace to process in-app transactions using its own payment platform. Until recently, the search giant applied a 15% fee to transactions processed with its payment platform. The company last year lowered the fee to 15% for the first $1 million in revenue that a developer generates during a given year.

The class-action lawsuit that Google settled this week had accused the company of charging developers “exorbitant fees in violation of federal antitrust laws.” The lawsuit also charged that the search giant limited the ability of third-party app stores to compete with its own Google Play marketplace.

As part of its agreement with the plaintiffs, Google is setting up a $90 million fund to support U.S. developers. About 48,000 developers will be eligible to receive money from the fund.

“A vast majority of U.S. developers who earned revenue through Google Play will be eligible to receive money from this fund,” Wilson White, vice president of government affairs and public policy at Google, wrote in a blog post. “If the Court approves the settlement, developers that qualify will be notified and allowed to receive a distribution from the fund.”

Google is also taking other steps to address the plaintiffs’ concerns.

For the first $1 million in revenue that an Android developer generates during a given year, Google will continue to charge a reduced 15% transaction processing fee. That’s half what the company charged until lowering its fee last year. Additionally, Google will enable developers to continue using customer contact information they obtain through an app to target customers with promotions and other offers outside the app interface. 

Android 12, the latest release of Google’s mobile operating system, provides better support for third-party app stores than earlier versions. It enables third-party app stores to automatically download software updates. To settle the class-action lawsuit, Google has agreed to keep supporting automatic updates for at least three years.

The search giant will in parallel make a number of changes to Google Play. The U.S. homepage of the marketplace is set to receive a new section, dubbed the Indie Apps Corner, that highlights apps from small and independent developers. Additionally, Google will start publishing annual transparency reports with information about how Google Play operates.

Google rival Apple Inc. settled a similar class-action lawsuit last year over its own app policies. Apple set up a $100 million developer fund and also agreed to take a number of other steps to iOS app creators’ concerns.

Photo: Google

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