💸 An Alphabet That Begins with Settlement
Google and its parent company Alphabet know that the political tides are shifting on Big Tech and that antitrust actions are ramping up. With that in mind, the Internet titan has offered $90 million to settle a class-action lawsuit brought against it by small app developers alleging Google's Play Store violated federal antitrust regulations. Specifically, the suit claimed that listing on the Play store required small app users to process payments through Google's proprietary payment platform, which then charged a 30% fee. Google initially responded to this suit by lowering the fee to 15% on the first million dollars.
The minimum pay-out developers will get from this settlement is $250, but could be as much as $200,000.
Hagens Berman, the firm representing the 48,000 small app developers in the suit, said in a statement: “With this settlement, developers will have more room to grow and more money in their pockets to promote their hard efforts.”
The Growing Antitrust Debate
Across Europe and the United States, Alphabet (along with Big Tech in general) is coming under increasing regulatory pressure and calls to break up the mono/duo/oligo-polies held by Silicon Valley. In the UK, the country's Competition and Markets Authority (or CMA) called out Google for its “effective duopoly” (along with Apple) of the mobile ecosystem. “App developers also have to comply with Apple and Google’s rules for access to their app stores, which some say are overly restrictive,” the CMA wrote in a December 2021 statement. “Developers are required to accept these terms in order to reach users, which can include paying 30% commissions to Apple and Google.” In June, the CMA began looking into potential investigations it would launch into Google that may result in formal charges, fines, and new rules, reports Engadget. Similar actions are underway in the EU, and the US Senate is reviewing a proposed antitrust bill against Big Tech.
Clearly, Google is trying to make concessions on smaller cases to look better in the eyes of politicians, judges, and regulators when it comes down to fights on the bigger issues. Only time will tell how much well tactic will work.