Google to pay US$90 million to app developers to settle legal fight over app store service fees
- Google said it would put US$90 million in a fund to support app developers who made US$2 million or less in annual revenue from 2016 to 2021
- App developers accused Google of using agreements with smartphone makers and technical barriers to shunt most payments through Google Play
The app developers, in a lawsuit filed in federal court in San Francisco, had accused Google of using agreements with smartphone makers, technical barriers and revenue sharing agreements to effectively close the app ecosystem and shunt most payments through its Google Play billing system with a default service fee of 30 per cent.
As part of the proposed settlement, Google said in a blog post it would put US$90 million in a fund to support app developers who made US$2 million or less in annual revenue from 2016 to 2021.
“A vast majority of US developers who earned revenue through Google Play will be eligible to receive money from this fund, if they choose,” Google said in the blog post.
Google cuts app store fees after similar Apple move
Google said it would also charge developers a 15 per cent commission on their first million in revenue from the Google Play Store each year. It started doing this in 2021.
The court must approve the proposed settlement.
There were likely 48,000 app developers eligible to apply for the US$90 million fund, and the minimum payout is US$250, according to Hagens Berman Sobol Shapiro LLP, who represented the plaintiffs.
In Washington, Congress is considering legislation that would require Google and Apple to allow sideloading, or the practice of downloading apps without using an app store. Google says it already allows sideloading. It would also bar them from requiring that app providers use Google and Apple’s payment systems.
