Google has reached a settlement with state attorneys general over allegations that the tech giant used anticompetitive tactics to force app developers to use its in-app payment platform, which took a 15% to 30% cut of payments. A separate class-action suit filed on behalf of nearly 21 million consumers also complained that Google’s 30% cut of Play Store transactions drove app prices higher. The financial terms of the settlement were reached in September but were not made public until now.
As part of the settlement, Google will make it easier for Android users to download apps directly from developers. The company also reached an agreement with Match Group, which owns and operates several dating apps, over Play Store policies.
A Google vice president stated that the settlement maintains Android’s choice and flexibility, while an attorney for the states noted that no other U.S. antitrust enforcer has yet been able to secure remedies of this magnitude from Google.
Under the terms of the settlement, $630 million of the $700 million paid by Alphabet will be used to create a common fund to benefit consumers. The remaining $70 million will be used to pay the states for penalties, restitution, disgorgement, and fees. Consumers with claims against Google will receive at least $2 each from the settlement, and potentially more based on their spending in the Google Play Store between August 16, 2016, and September 30, 2023. The settlement still requires approval from a judge.