Alphabet’s Google has agreed to pay a total of $700 million in a settlement with U.S. states and consumers over allegations of overcharging consumers through unlawful restrictions on the distribution of apps on Android devices and unnecessary fees for in-app transactions. The settlement, which still requires a judge’s final approval, will see Google pay $630 million into a settlement fund for consumers and $70 million into a fund that will be used by states.
The settlement allegations against Google claimed that the company harmed competition through its app store terms. As a result, Google has agreed to make several changes to its Play app store, including expanding a pilot program that allows users to choose whether to pay for in-app purchases through third-party billing systems. This agreement is expected to reshape Google’s app store business amid intense scrutiny of its control over the market.
This resolution follows accusations that Google imposed stringent regulations on app developers, limiting their ability to distribute software through alternative channels. The Play Store’s dominance in the Android ecosystem has raised antitrust concerns, prompting legal action from various states and consumers.
While Google maintains its position as a leading player in the tech industry, the settlement underscores the need for companies to adapt to evolving regulatory landscapes and address concerns related to fair competition. The effects of this agreement are likely to be felt not only within Google but also across the broader tech ecosystem, prompting a reevaluation of business practices to align with regulatory expectations.
Under the terms of the settlement, eligible consumers will receive at least $2 and may get additional payments based on their spending on Google Play between August 16, 2016, and September 30, 2023. All 50 states, the District of Columbia, Puerto Rico, and the Virgin Islands have joined the settlement.