SAN FRANCISCO (AP) — A federal court jury has decided that Google’s Android app store is protected by anticompetitive barriers that hurt smartphone consumers and software developers, dealing a blow to a key pillar of its tech empire.
The unanimous ruling came Monday after just three hours of deliberations following a four-week trial revolving around a lucrative payment system within the Google Play Store. The Store is the main place where hundreds of millions of people around the world download and install applications that run 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, alleging that the Internet search giant was abusing its power to protect its Play Store from competition in order to protect a multi-billion-dollar gold mine. dollars annually. Just as Apple does with its iPhone App Store, Google collects a 15% to 30% commission on digital transactions completed within apps.
Apple won a similar case brought by Epic against the iPhone App Store. But the 2021 trial was decided by a federal judge in a ruling under appeal at the US Supreme Court.
The nine-person jury in the Play Store case seemed to see things through a different lens, even though Google technically allows Android apps to be downloaded from different stores — an option that Apple blocks on the iPhone.
FILE – The San Francisco-Oakland Bay Bridge is seen behind a Google sign at the company’s office in San Francisco on April 12, 2023. A federal court jury is expected to begin deliberations Monday in the antitrust trial focusing on whether Google’s efforts to thwart it as… Competition against its own app store for Android smartphones also illegally manipulates consumers and stifles innovation. (AP Photo/Jeff Chiu, File)
Photo: AP/Jeff Chiu
Just before the Play Store trial began, Google sought to avoid having a jury determine the outcome, but US District Judge James Donato denied its request. Now it will be up to Donato to determine what steps Google will need to take to get rid of its illegal behavior in the Play Store. The judge indicated that he will hold hearings on this issue during the second week of January.
Epic CEO Tim Sweeney smiled broadly after the ruling was read, slapped his lawyers on the back and also shook hands with Google’s lawyer, who thanked him 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 praised the ruling as “a victory for all app developers and consumers around the world.”
Google plans to appeal the ruling, 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 mobile platform,” White said.
Depending on how the judge implements the jury’s verdict, Google could lose billions of dollars in annual profits generated from Play Store commissions. The company’s main source of revenue — digital advertising mostly tied 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 hearing two hours of closing arguments from attorneys on opposing sides of the case.
Epic lawyer Gary Bornstein portrayed Google as a ruthless bully deploying a “bribery and ban” strategy to discourage competition against the Play Store for Android apps. Google’s lawyer, Jonathan Kravis, attacked Epic as a self-interested game maker trying to use the courts to save itself money while undermining the ecosystem that has produced billions of Android smartphones to compete against Apple and its iPhone.
Much of the dueling arguments between attorneys dealt with the testimony of a series of witnesses who came to court during the trial.
Key witnesses included Google CEO Sundar Pichai, who at times sounded like a professor explaining complex topics while standing behind a podium due to a health issue, and Sweeney, who portrayed himself as a video game enthusiast on a mission to take down the greedy tech giant. .
In his closing argument for Epic, Bornstein criticized Google for exploiting its power over Android software in a way that “resulted in higher prices for developers and consumers, as well as reduced innovation and quality.”
Google has strongly defended kickbacks as a way to help recoup the more than $40 billion it spent building the Android software that it has been distributing since 2007 to manufacturers to compete against the iPhone.
Kravis emphasized in his closing argument that “Android phones cannot compete with the iPhone without a great app store on them.” “Competition between app stores is tied to competition between phones.”
But Bornstein scoffed at the idea of Google and Android competing against Apple and its software system that is not compatible with the iPhone. “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. In addition to competing app stores pre-installed on devices made by other companies, more than 60% of Android phones offer alternative ports for Android apps.
However, Epic has presented evidence confirming the idea that Google welcomes competition as an excuse, citing the hundreds of billions of dollars it has distributed to companies, such as game maker Activision Blizzard, to discourage them from opening competing app stores. Along with making those payments, Bornstein also urged the jury to consider the “horror screens” that appear from Google, warning consumers of potential security threats when they try to download Android apps from some Play Store alternatives.
“These are classic anticompetitive strategies that dominant companies use to protect their monopolies,” Bornstein said.
Google’s empire could be further undermined by another major antitrust trial in Washington that a federal judge will decide after hearing final arguments in May. The experience highlighted Google’s cozy relationship with Apple in online search, the technology that turned Google into a household word just years after two former Stanford graduate students founded the company in a garage in Silicon Valley in 1998. .
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In a major legal victory for Epic Games, the company has successfully won an antitrust lawsuit against Google over barriers to its Android app store. The ruling marks a significant development in the ongoing battle between tech giants and app developers, with Epic Games at the forefront of challenging the dominance of app store policies. This decision is set to have far-reaching implications for the future of the mobile app market and could potentially bring about significant changes in the way app stores operate.