Google has agreed to pay a $90 Mn settlement for a lawsuit filed by law firm Hagens Berman, on behalf of app developers. The lawsuit accused Google of creating a monopoly for app distribution on Android, and in turn charging “exorbitant fees” for it.
Google had been accused of partnering with smartphone makers, technical barriers and revenue sharing agreements, charging a 30% service fee fee on transactions. Google had capped service fee at 15% for the first 1 million in revenue.
The $90 Mn would be put in a fund to compensate the around 48,000 app developers that made less than $2 million in annual revenue between 2016-2021. While the minimum payout is $250, the ones affected most would be eligible to claim a sum of $200,000. The settlement would come into effect once it is approved by the court.
In addition, Google will be making changes to Android, to make it easier to use alternate app libraries. Google would also be creating an “Indie apps corner” on the Google Play Store, to highlight apps from low budget developers offering high quality products. Further, Developer distribution agreement will be updated to include the clause that developers would be allowed to contact users directly and not just through the app. On top of all this, Google has also obliged to publish annual transparency reports, detailing why any apps were removed or any developer accounts were terminated.
Hagens Berman had successfully forced Apple into a settlement in a similar lawsuit last year, when Apple settled for $100 Mn and similar policy changes. Read more here.