Thirty-six US states file lawsuit against Google: Here's why
What's the story
As many as 36 US states and Washington DC have filed a lawsuit against Google, alleging the company's control over its Android app store violates antitrust laws.
Through a series of exclusionary contracts and other anticompetitive conduct in the Play Store, Google deprived Android users of robust competition that could lead to greater choice, innovation, and significantly lower mobile app prices, the lawsuit alleges.
Details
Google forces app consumers to pay up to 30% commission
Google is also accused of requiring app developers selling in-app digital content through apps purchased via the Google Play Store to use Google Billing as a middleman, forcing app consumers to pay Google's commission up to 30% indefinitely.
These complaints were made by New York Attorney General Letitia James and the coalition co-led by the attorneys general of Utah, North Carolina, and Tennessee.
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'We are paying more for the software we use daily'
"Google has served as the gatekeeper of the internet for many years, but, more recently, it has also become the gatekeeper of our digital devices resulting in all of us paying more for the software we use every day," James alleged.
Competition
Google uses its dominance to illegally quash competition: James
James said, "Once again, we are seeing Google use its dominance to illegally quash competition and profit to the tune of billions."
"Through its illegal conduct, the company has ensured that hundreds of millions of Android users turn to Google, and only Google, for the millions of applications they may choose to download to their phones and tablets," she added.
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Google is squeezing lifeblood out of small businesses: James
"Worse yet, Google is squeezing the lifeblood out of millions of small businesses that are only seeking to compete. We are filing this lawsuit to end Google's illegal monopoly power and finally give voice to millions of consumers and business owners," James said.
Third-party apps
Google prevents third-party app developers from distributing apps: Lawsuit
The lawsuit alleges Google also imposes technical barriers that strongly discourage or completely prevent third-party app developers from distributing apps outside the Play Store.
"Google builds into Android a series of misleading security warnings and other barriers that discourage users from downloading apps from any source outside Google's Play Store, effectively foreclosing app developers and app stores from direct distribution to consumers," it alleges.
The ACCs
It forces OEMs to enter into Android Compatibility Commitments
The lawsuit further alleges, "Google forces OEMs (Original Equipment Manufacturers) that wish to design their devices to use Android to enter into agreements called Android Compatibility Commitments or ACCs."
"Under these take-it-or-leave-it agreements, OEMs must promise not to create or implement any variants or versions of Android that deviate from the Google-certified version of Android," it adds.
Potential competition
Google buys off potential competition in the market: Lawsuit
The lawsuit alleges that Google buys off its potential competition in the market for app distribution.
"Google forces app developers and app users alike to use Google's payment processing service Google Play Billing to process any payments for purchases of digital content made in apps obtained through the Google Play Store," it said.
Processing fee
Google charges exorbitant processing fee for each transaction
Google is unlawfully tying the use of Google's payment processor, a separate service within a separate market, for payment processing within apps to distribution through Google Play Store, the lawsuit alleged.
"By forcing this, Google is able to extract an exorbitant processing fee for each transaction, as high as 30%, and many times higher than payment processing fees charged in competitive markets," it added.